Planning a trip but unsure how much to save? Creating a travel budget doesn’t have to be complicated! This guide breaks down how to budget for a trip in six simple steps, so you can manage your expenses wisely while still enjoying unforgettable experiences.
Budgeting for a trip might not be the most exciting part of travel planning, but trust us—it’s worth it.
When we first started traveling, we didn’t always get it right (hello, surprise expenses and dwindling funds!).
But over the years, we’ve figured out a system that allows us to budget smartly while still leaving room for fun splurges—because let’s be real, travel isn’t just about saving money, it’s about making unforgettable memories.
In this guide, we’re breaking down how to create a travel budget in 6 simple steps so you can feel confident about your finances and focus on enjoying the adventure.
The beauty of this exercise is that you can cater it to fit whatever your dream trip may be – whether it be a one-week vacay in Hawaii or a one-year journey around the world.
And better yet, it only takes about 20 minutes to come up with a really solid plan of how much money you’ll need to save for your trip. So what are you waiting for?
Let’s take the first step in turning your daydreams into reality…
1. Define your travel style
Travel is completely personal, and there’s no “right” or “wrong” way to do it. But in order to determine your budget, you’ve first got to figure out your travel style.
Read the following statements and see which one sounds most like you:
Budget Traveler:
“I don’t mind sleeping in dorm rooms or taking local forms of transportation (even though it’s sometimes slower). I prefer eating at authentic “hole-in-the-wall” type eateries and don’t typically like doing organized tours. I enjoy traveling on a budget because it allows me to interact with locals and often brings more adventure than when you pay top dollar.”
Mid-Range Traveler:
“I like a mix of comfort and authentic adventure. I don’t want to sleep in dorm rooms with people I don’t know, but I don’t need a 5-star hotel every night. When traveling, I enjoy eating at a variety of places –ranging from street stands to nice cafes. I like splurging every once in a while, but am okay roughing it a bit too. For me, it’s all about balance.”
Luxury Traveler:
“When I travel, I like to enjoy the finer things – from plush hotels, to the top-rated restaurants and entertainment. I think that a vacation should be full of splurges, and I don’t like holding back. I enjoy once-in-a-lifetime experiences and I like to have all the details arranged for me, even if it costs more money. Traveling is my time to relax and explore, and I don’t want to miss out by sticking to a strict budget.”
So which one is it?
Maybe you are between two styles. Not quite “budget”, but not exactly “mid-range” either. Or perhaps you’re between “mid-range” and “luxury”.
Remember, there is no right or wrong way to feel. But determining what type of travel style you identify with is the first step to coming up with a realistic budget.
2. Find your daily budget
Do a quick Google search for a daily budget of a country you’re thinking of visiting. A good site to start with is Budget Your Trip.
Choose a country, your travel style (step #1) and your currency, and you’ll get a pretty good estimate of how much to expect to spend each day.
Write this number down because you’ll need it for the next steps.
3. Get your preliminary total
Multiply the number you got in step #2 (daily budget) by how many days you plan to be there. This will give you the preliminary cost of your trip. But, hold on – you’re not done just yet!
4. Give yourself some “padding”
Now, calculate 10-20% of the preliminary total you got in step 3.
You know yourself best. If you’re great at sticking to a budget, maybe you can get by with an additional 10%. But if budgets aren’t your thing, maybe an extra 25% is more realistic. We typically add a 15% padding.
Add this number to your total, but don’t include it in your daily spending budget (step 2). Remember, you don’t necessarily want to spend this money – it’s just there as a buffer for souvenirs, last minute splurges or incidentals.
5. Plan your splurges
Even if you have a budget to stick to, splurges are just part of traveling.
Don’t let lack of money hold you back from something you’ve been dreaming about, like diving in the Galápagos or taking a hot air balloon ride in Cappadocia. It may be expensive, sure, but it’s part of your journey. And if you want it badly enough, it’s worth it.
Plan out your splurges so you’re ready for them. (Include this cost in your total budget, but don’t divide it into your daily spending.)
And when you do splurge, make sure it’s with an ethical company giving back to the local community and environment. Read our tips for traveling responsibly for more information.
→ Psst! Looking for travel inspiration? These epic bucket list trips will spark your wanderlust.
6. Add on airfare and travel insurance
Note that when you search for a daily budget in a particular country, it will typically NOT include airfare or travel insurance. You will have to add these costs in as well.
For airfare: We like getting airfare estimates using Google Flights because you can search an entire month and see the cheapest day to fly. Be sure you read through our secret ways we save money on airfare to find the best flight deals!
For travel insurance: We like to use World Nomads for travel insurance. Get a super quick quote here.
And be sure to read our comprehensive guide to travel insurance to find out why we NEVER leave home without it!
And there you have it: Your own fully-customized travel budget! CONGRATS!
Tip: You can also do this exercise in reverse. What I mean is if you have $3,000 USD saved up, and you want to visit Thailand, start with Step #6 and work backwards by subtracting the costs. You’ll be able to see how many days a reasonable budget will bring you with $3,000 USD to spend.
Next steps:
- How to Save Money for Travel
- How to Plan a Trip in 10 Simple Steps
- Secret Ways We Save Money on Flights
- Genius System for Booking the Best Hotels & Airbnbs
Let us help you travel better…
Be sure to check out our Travel Planning Homepage for resources on everything you need to know about how to plan a trip, from packing to budgeting and more! Or you can read some of our favorite articles about planning your next trip below.
- How to Plan a Trip in 10 Simple Steps
- Expert Tips for Finding Cheap Flights
- Carry-On Packing List: What You Actually Need on a Flight
- Our Favorite Travel Essentials
- This is the one thing we NEVER travel without!
- Packing Hacks to Help You Pack Light Every Time
- Tips to Fight Jet Lag (that actually work!)
- How to Get Cell Service Abroad (without spending a fortune!)
→ Traveling as a family? Don’t miss our family travel articles!
What if the hard part was already done for you?
All you have to do is pack your bags!
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We want to hear from you!
We hope this article cleared up your questions on how to budget for a trip. We think having a travel budget is the number one key to continuing to make travel part of our lifestyle. If you have any more questions, leave your comment below and we’ll do our best to get back to you!