Americans are tingling with wanderlust, which may result in a hangover for your wallet if you’re not careful.
Nearly six million more travelers have been screened by the Transportation Security Administration so far this year than at the same point in 2019. At the same time, sky-high inflation has caused the price of a vacation to soar.
With a little planning, though, you can enjoy a relaxing vacation at a reasonable price.
1. Build a budget in advance
Before you start planning your vacation, build a budget. Decide how much you can afford to spend without derailing your other financial goals. If you start picking out vacation stays and activities beforehand, it could be tempting to spend more than you can truly afford.
You shouldn’t dip into your retirement fund, use your emergency savings or get a personal loan to take a vacation.
Once you have a clear idea of how much you can comfortably spend on a trip, use that amount as a framework for your travel plans.
2. Plan ahead
“One of the best ways to save money on travel is by planning and booking your trip well in advance,” said Nadia Podrabinek, founder of Why This Place, a travel advice company based in Valencia, Spain. “[Planning ahead] gives you ample time to compare prices, look for deals and discounts, and make informed decisions.”
You can put more dollars towards what you really want to do rather than having to shell out for full-price items or last-minute upcharges.
Eleventh-hour bookings are often more expensive, especially during a peak season.
3. Pick the right time
When it comes to saving money, a little bit of flexibility on your travel dates can go a long way.
“Consider traveling during off-peak seasons when prices are lower,” said Podrabinek. If you’re able to travel in a different season, you might be surprised by how much you can save.
Traveling off season isn’t always in the cards though. It’s probably not possible to go skiing in Colorado in June, for example. In that case, “look for cheaper mid-week flights than weekend ones,” Podrabinek suggested.
Some travel apps, such as Skyscanner and Hopper, feature a calendar view that shows prices, so you can quickly see how costs fluctuate without doing multiple searches.
4. Be flexible with your destination
Some destinations are undeniably more expensive than others. Everything from accommodations to snacks may be more expensive in a huge urban center or resort area.
Consider how to get what you want from a place that may not be top of mind.
For example, plane tickets to Puerto Rico tend to be hundreds of dollars less expensive than flights to the Bahamas and both places have beautiful, tropical beaches.
If you’re traveling internationally, “look for countries with favorable exchange rates, affordable accommodation options and low-cost activities,” said Podrabinek.
Ultimately, choosing the right destination can be the key factor in planning a high-quality trip on a budget.
5. Compare accommodation costs
Whether you want a private hot tub or you’re happy with a closet-sized room, check out your options, including hotels, motels, hostels and private rental spaces.
“Especially if you are going with friends or family it can be cheaper to split an Airbnb than for each to get a hotel room,” said Kendall Meade, a certified financial planner (CFP) at SoFi based in Charleston, S.C. “Make sure to shop around for your accommodations.”
6. Consider travel rewards
Loyalty programs and travel rewards credit cards can maximize your savings via discounts and travel perks.
“Personally, I’ve used travel rewards credit cards with great success,” said Ross Loehr, a CFP based in Jacksonville. “For example, on my last trip, I was able to snag two round trip tickets to Europe for only the cost of taxes and fees.”
With the right rewards strategy, you could see the world at a fraction of the cost.
7. Scope out free fun
“While it’s natural to want to explore paid attractions and experiences at your destination, don’t overlook the abundance of free and low-cost activities available,” said Hammer Tsui, cofounder of the travel blog A Fun Couple.
Most destinations offer a wide range of free activities — visits to parks, monuments, art galleries, local markets, cultural centers and boardwalks don’t have to cost a dime. Many museums have hours of gratis admission and you can almost always find free live music, whether you’re out in the country or the city.
Taking advantage of these things will not only give you a chance to see the sights, but can also leave some extra breathing room in your budget.
8. Pack your own snacks
Food courts, fast food chains and street vendors aren’t known for providing the least expensive and most nutritious meals. To avoid spending money on subpar sustenance, consider packing your own snacks.
“You can easily spend $20 just on snacks in between flights that would cost you $5 or less if you brought it from home,” said Meade.
9. Cook some meals yourself
Going beyond snacks, if you’re willing to cook or at least slap a sandwich together, you can tap into savings.
For example, Meade generally cooks breakfast and packs sandwiches for lunch when she travels and only goes out for dinner.
“By not eating out for those two meals per day, I estimate we are able to save $510 on a week’s vacation,”she said.
Prepping your own meals can be easy if your hotel room has a minifridge and it can even be convenient if you’re renting a place with a kitchen.
10. Travel light
Since most airlines charge passengers a fee for checked baggage, those fees can add up fast.
“Packing light and sticking to carry-on luggage can lead to significant savings,” said Tsui. “By packing only the essentials and adhering to airline carry-on size restrictions, you not only save on baggage fees but also have the convenience of not waiting for your luggage at the carousel upon arrival.”
Where travel can get a bit pricey
The biggest single-ticket items in travel are often the accommodations and the traveling itself — the airfare, the rental car or even just the cost of gas. When it comes down to making a trip more affordable, many travelers are willing to forgo smaller-ticket items that add up.
A recent study by Destination Analysts found that 60% of American travelers would be likely or very likely to make money-saving compromises. Almost half of the compromisers intended to cut back on dining and food expenses. Others are planning to cut back on shopping or even cut the length of their trip to stay on budget.
What makes a vacation worthwhile varies by individual. Skipping a Broadway show when you’re in New York may be unthinkable, but not going out to a fancy dinner afterwards might be acceptable.
As a traveler, take an honest look about your spending tendencies before heading out on your next vacation. If you’re looking for ways to cut back, you’ll likely spot a solution.
Other tips to prepare before you travel
Seasoned travelers tend to have built-in strategies to keep their trip on a smooth course. A few ways to set yourself up for a successful trip include:
- Notify your bank of your intended destination. This can prevent your debit card from being frozen on suspension of fraud.
- Share your itinerary. Let someone you trust know where you’ll be when and set up check-in times. Apple users can also use the share location feature.
- Withdraw cash. You might need some cold, hard cash for cab fare or simply to negotiate a better price on a special souvenir, even if you’re staying in the country.
- Have the right travel medical insurance. Whether you’re going to Paris or climbing Mont Blanc, make sure that you and your family will be covered if anything happens.
Best travel rewards credit cards to help you save
Travel rewards credit cards can help you turn your regular spending into rewards that can offset some of your vacation costs. The right card should give you an opportunity to make the most of your spending — whether you get one that’s tied to a specific airline that you frequent or a hotel chain you prefer.
As you explore your top rewards credit card options, there are several factors to consider:
- Welcome bonus. To entice you to sign up for a credit card, many companies offer a welcome bonus, which, while often having a spending requirement, can represent a big score for vacation budget.
- Annual fee. While there are travel rewards cards with no-annual-fee, many have an annual fee attached. Make sure you are comfortable with any fee before signing up.
- Rewards potential. Every card has different rules on how it rewards your spending. Some might offer extra points per dollar based on the type of purchase. Seek out a card that offers the best rewards potential for your spending preferences.
- Redemption options. Before you sign up for a card, make sure you’re comfortable with the redemption options. Some cards allow you to spend points anywhere, but others only offer redemption options at a specific brand.
Frequently asked questions (FAQs)
The amount you should save for travel depends on your preferred destinations. A trip to a nearby town will likely require less savings than a jaunt around the world. You could research the costs of your ideal itinerary and have that amount (plus maybe 10% extra, just in case) be your savings goal.
The 50/30/20 budgeting rule dictates that you’ll put 50% of your income toward things you absolutely need, 30% toward wants and 20% toward savings. Travel typically falls within the want category.
Using a credit card while traveling abroad can offer a safer way to spend. Many come with no foreign transaction fees and have built-in fraud protection. But only opt for a credit card if you can trust yourself to spend responsibly.
A few ways you can slash your travel costs include planning your trip for the off-season, looking for affordable accommodations, choosing to cook some of your own meals and opting for some free activities. Also, reward programs offered by credit cards and major businesses, such as airlines and hotel chains, can help you lower your travel costs.