It’s no surprise that most people want to travel more, but how do you save money for travel and still live a full life at home? The other day I read something online that most millennials are willing to give up Tim Hortons, Netflix, shopping & hockey to travel. So what would you give up to save up to travel the world?
Ways to Save Money for Travel
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Before Dave and I became full-time travel bloggers, we had full-time jobs, mortgage payments, and bills to face each month. This was not how we wanted to live our lives. We didn’t love our jobs and we were constantly feeling behind the eight ball. What we did know is that we knew we wanted to travel more.
Dave and I already traveled extensively for nearly a decade before we decided to become bloggers. Before putting a word on the Internet, we already traveled to 40 countries while juggling our careers and life in Canada. From our months abroad between jobs, we decided we wanted to make travel a full-time career, and we were determined to make that happen.
Many of our friends and family members thought we were flaky and wasting our hard earned money on travel. The truth is, we never once dipped into our savings. We didn’t want to go into financial ruin to follow our dreams, so we decided to find out how we could save more money and put that money towards travel whenever we could.
These are the tips we found that helped us to save most money for travel and follow our dreams.
1. Don’t Travel on Borrowed Money
Our number one rule for traveling is to never travel on borrowed money. I know that’s not necessarily a Millennial way of thinking, but take it from us, coming home to a mound of debt after a life-changing travel experience is not what you want to face. Debt is stressful and if you can avoid it, you’ll live a happier life.
We never left home until we were sure that our monthly bills, investment contributions, and expenses could be covered for the months we were away. If we didn’t have the money saved, we either changed travel plans to cut it shorter, visit a cheaper destination or spend more time exploring our own backyard until we did save our money.
2. Create a Travel Budget
We have found that the best way to save for travel is to create a budget. If you ask these questions, it will help you identify how much money you’ll need to travel.
How Much Should You Be Saving for Travel?
- What will your daily travel budget be?
- How much are you going to spend on a hotel nightly?
- What is your allowance for meals?
- What is your excursion budget?
- What do you plan on spending on meals?
- How Long are you Traveling For?
- Are you going to be a budget traveler or mid-range?
- Read more at How to Travel on a Budget – Our Top Cheap Travel Tips
For example, hostels are definitely a way to keep costs down and you could easily go lower than that if you are traveling through places like South East Asia or Central America.
If you are traveling through South East Asia, you may easily be able to budget $50 – $100 a day. That means you will need $10k – $20k for a six-month trip. Not including flights – We talk below about using rewards credit cards to help you save on flights.
So in conclusion, if you want to travel within one year and you need $15k for a six-month trip, you will need to put away $1250 per month if you start from zero. But don’t worry, you won’t have to start from zero, we’re going to show you ways to find the money.
- Some people travel for much less: See How PE World Tour traveled on $2400
- Make sure to check out our tips on How to Travel on a Budget.
- Check out the book How to Travel the World on $50 a Day for more ideas.
3. Set up an Automatic Travel Fund Saving Account
Now that you know how much money you need to travel, we suggest setting up an automatic withdrawal to go into a travel savings fund. In the same way that you have automatic withdrawals for your bills, your investments, and your rent. Set up that fund and have it come out of your bank account every single month.
4. Track Spending
When saving money for travel it is really important to know what you are spending your money on. I can’t stress this enough, pay attention to where your money is going when budgeting for travel. Sit down and start making a list of where you spend every single penny each month. Be diligent and don’t let anything slide by.
Perhaps you stop every day at the corner store near the subway and grab a snack or a coffee that you could have taken from home or gotten at work. If you spend $5-$10 a day on little things, that’s $150-$300 a month that could have gone to travel. See how quickly money can add up?
Do you have a Netflix, Amazon Prime, and HBO Max account? Maybe you only need one. Are you still paying for TV cable? Get rid of it!
I have cut Dave’s hair for years saving us a ton of cash. (See picture above) And I grew my hair out needing nothing more than a monthly trim which I did myself (and had Dave help in the back) That’s a good $100-$200 savings on haircuts a month! (thanks to Minority Nomad for reminding us about this point!)
Is your cell phone bill the highest one you can get? Maybe you can drop it down to a smaller plan. Do you have a gym or Peloton membership that you never use? Cancel it. It’s all these little things that can add up to big savings.
5. Pay off Your Credit Cards
We have always been really good with paying off our credit cards. Holding a balance on a card stresses me out, so I pay it off every month before the due date. Don’t throw money away by paying interest on credit cards. If you can’t afford something, don’t buy it on a credit card hoping the money will magically appear.
But that doesn’t mean we don’t use our credit cards. We actually put everything on a credit card. It is the easiest way to track expenses. You can check your statement each month and see where your money is going. And it is the easiest way to save money for travel. Plus, when you get the “right credit card” you can earn money for travel as you pay for your every day expenses.
6. Get a Rewards Credit Card
One of the most expensive up-front costs for long term travel is your flights. This is where a travel rewards credit card will come in handy. But as I said above, only if you pay it off each month and are diligent about not spending more than you need.
You’d be amazed how quickly you can earn travel points and rewards when you buy things like groceries, toiletries, and even medication on your credit card. Rewards add up fast.
We usually have anywhere from $1000 – $2000 towards travel by the end of each year. We purchase a ticket and then give American Express or Visa a call and ask them to pay it off with our rewards. (if we have enough – which we usually do because we put all expenses on it)
With a travel rewards card, you also get a sign-up bonus. Just by signing up, you could get a lot of money for a flight. Do some research to see what card is best for you. What card offers the flight rewards you want?
- We use American Express most of the time, but our TD Travel Visa does not have a fee and it has great travel benefits too. Our Amex offers travel rewards. We make purchases all year on it and we get rewards with each one.
- Chase Sapphire is popular in the United States and we hear it is even better than Amex.
7. Change Your Living Situation
If you have a house, but you have a dream to travel, you may want to sell it. That’s what we did. We knew we weren’t happy being homeowners at the time, so we put it up for sale.
I remember the time that we owned that house was the most stressful time of our lives because all we wanted t do was travel. We were always worried about money and what we would do if the next movie contract didn’t come in. We felt trapped and wondered if this was going to be where we were stuck for the rest of our lives.
If you don’t want to sell your house, you may just want to start looking for a subletter to rent your place for a year or so. I know people that have sublet their house while building equity and traveling full time. They rent in other places instead of moving back home and are perfectly happy. And of course there is always AirBnB or VRBO to make money from your property.
If you are currently renting, you may want to move to a smaller place in a cheaper neighborhood. Think of any way to cut costs. This is a relatively easy way to save money if you have larger assets like this. And if you have a loving and generous family, (like we did) you may want to stay with them for a few months. This can put thousands of dollars in your pocket for your travels.
8. Sell Your Things
We had a garage sale to get rid of all the stuff we had bought over the past few years. We made a couple of thousand bucks on our garage sale if you can believe it. We sold everything from lawnmowers to our Doctor Ho massager and even a knife (that we didn’t realize was worth so much) but a guy offered us $50 for it!
Of course you can simply go on Kijiji and Facebook Marketplace too. You’ll be surprised at what people will pay for.
People were giving us 20 bucks for glassware sets and knick-knacks. We had so much clutter. And it felt amazing once it was all gone. Even if you don’t want to sell your house, having a garage sale or selling it online will make you some extra cash while lifting the weight of all that extra clutter.
9. Lifestyle Change and Mindset
When you need money to travel, one of the most obvious places to look at is your lifestyle. By changing a few habits you can put away more cash for your next trip. We owned two cars that we were paying two monthly payments. When we went down to one car, we sold the newer one and paid off the other.
With no car payments (and because the car we were driving was older, we canceled the collision insurance on it) we saved hundreds of dollars a month. We cut our insurance fee by hundreds. Now with no car payments and less insurance, we were spending a lot less on car expenses. Plus, by living in the city, we paid less for gas and could ride our bikes or walk to wherever we wanted.
10. Stop Eating Out
This was a tough one for us. We loved eating out, it was our time to chat and catch up. But once we started eating at home more, we saved a lot more money. If I could tell my 23-year-old self to learn to cook at home, I would have saved myself a lot of money headaches.
We made cooking an event and bought only fresh ingredients in bulk. When we did have wine or beer, we went for the cheap stuff. Yes, we bought boxed wine and cheap beer. Luckily, we were so busy with life, we didn’t miss alcohol at all while saving for our travels. We had a goal in mind and when thinking about putting $40 towards alcohol or our travel fund, the fund usually won out.
And we invested in a good coffee maker so we didn’t have to go to Starbucks whenever we needed our caffeine fix. I always called Starbucks “Four-bucks.” Four bucks a pop, for a coffee, adds up fast!
11. Cut Entertainment Costs
We used to meet friends at the bar or nightclub and spend a fortune on drinks and food. As our lifestyle changed, we started to go over to friends’ houses and have them over to ours. We still had a social life, but we weren’t throwing money away downtown and we were saving money toward our goal.
12. Cut Expensive Hobbies
When we had our house, our hobbies were pretty expensive. We had a ski pass at Blue Mountain Resort and often stayed over at the hotel after eating out at the restaurant. We also did a lot of scuba diving trips in the summer around the Great Lakes and St. Lawrence River staying in lodges each weekend.
These were very expensive hobbies so we cut them out and took up cheaper hobbies. Plus by selling our dive gear and snowboarding gear, we pocketed more money. We never bought it again. Now when we go diving or snowboarding we rent the gear.
13. Find Free Things to Do Instead
When we moved downtown, we got more into rock climbing. Our one splurge was our rock climbing gym membership, and we basically became gym rats. We loved climbing and were there nearly every night during the week!
But having THAT gym membership (that we used and loved) we saved money from eating out every night and going to clubs on the weekend. We loved being at the climbing gym and that took up a lot of our time. Instead of spending a ton of money each weekend, we went camping near the crag and then went rock climbing for free.
We ended up doing a lot of fun free things like mountain biking, and meeting up with the cycling club for evening rides. We took up hiking and spent our weekends exploring Niagara Glen or the Bruce Trail. We were busy and adventurous and didn’t spend much money on anything except for snacks and maybe a park entry fee.
14. Think Positive
I know it seems like a lot, but it can be done. If you take things one step at a time and follow our tips for saving money, you can achieve your goal of traveling the world.
Make a list, take stock of your expenses, debt, and income and figure out what you need to do to follow your dream. For us, it was overwhelming to do all of these things before we left for our travels, but once we were on the road, we were free to enjoy our travels because we didn’t have any worries at home.
And we have never missed all that stuff we gave up. Since we started a life of travel, we’ve enjoyed the freedom of not having clutter in our lives and debt in our bank accounts.
Dave and I have always found that whenever we take a chance and make room for our dreams, great things happen. If you are not happy where you are in your life, start thinking differently and make that change. The best journeys start with the first step.
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