When you last went on vacation, how much money did you spend? More importantly, how much did you overspend? Did you even have a budget at all? Lots of us go on vacation and come home thinking, “That was great, but it cost too much money.” But it doesn’t have to be that way. With a smart budget, anyone can go on vacation a stick to a reasonable spending limit. But how?
There are lots of ways you can budget for a vacation. If you don’t know much about travel costs (like airfare and hotel rooms), or your destination, it can be really difficult to come up with a budget that will keep your bank account happy AND allow you to have enough fun during your trip. One way of coming up with a budget is called the price of transportation rule, and here’s how it works.
Determining Your Price of Transportation
The first step is to figure out how much it’s going to cost for you to arrive at, move around, and come home from your destination. Oftentimes you don’t have too many choices, and it can be difficult to save on transportation (but not impossible). Your price of transportation is the total you’ll spend while on vacation, so it includes things like cab rides to the airport, airline tickets, cab rides to the hotel or attractions, and the cost of a rental car. Come up with one final figure on the price of transportation for your entire vacation, and move on to the next steps.
Budgeting for Domestic Trips
Let’s say that the price of transportation for your stateside vacation is going to be $500. Your daily budget should be half of the price of transportation, so budget to spend $250 per day on your vacation. Multiply half of your transportation cost by the number of days you’ll be on vacation, and you’ll have your total budget for everything else (not including cost of transportation). For example, a five-day stay for a vacation with a $500 price of transportation would be $1,250. Add back your price of transportation, and your entire budget for everything including transportation should be $1,750.
Budgeting for International Trips
The price of transportation for international trips is much more expensive than for domestic flights, but everything else is likely to be much more expensive, too. Let’s say the price of transportation for your international vacation is $4,000. Your budget for the entire trip should be equal to the price of transportation. Your budget would be $4,000 for everything (not including transportation). To find your daily budget, divide the price of transportation by the number of days of your trip. For a week-long vacation with a transportation price of $4,000, your daily budget should be about $571.
Adjusting Your Budget
When you use the price of transportation rule for your vacation budget, you must keep in mind that it is just a rough estimate. Use it as a guideline to start with when searching for hotel rooms and thinking about activities, but it may need to be adjusted according to your travel preferences (for example, a higher budget for a luxury hotel).
Lauren Williams is a travel agent and avid writer. She recently wrote about her family’s trip to Bahamas island resorts.