Planning the financial aspects of your trip and figuring out how much money you are going to need is an important part of any backpacking experience. By crunching some numbers, you will have a better idea about how much money you need to save up to make your trip possible. A financial plan is essential to the success of your trip.
Your budget should be considered long before you leave. Knowing approximately how much money you will need gives you an idea about how much you will need to save. You must set a goal well in advance so that it can be reached by the time of your departure. Planning ahead for your budget isn't very difficult. Consider the following expenses:
To figure out how much money you will need, you must first consider where it is you are traveling to. Much of the world is quite inexpensive, but there are places that will drain your wallet faster than others. London, anywhere in Scandinavia, and Japan are some of the most expensive places to travel in. On the flip side, you can live and travel in parts of the Philippines for a couple of dollars a day.
Next, break down your expenses into initial costs and daily costs. Initial costs include your airline ticket, your backpack, passport, guidebook, hostel card and all other equipment purchased before you leave. Already have some of this stuff? Can you borrow any of it from friends? If so, you're saving money already. If you are headed for Europe, a Eurail pass would also be a wise initial expense.
The next thing to consider is how many days you will be away. Obviously, the longer your trip, the more money you will need. Now you can figure out roughly how much you will spend on the following each day: accommodations, food, transportation and sight-seeing. A typical budget for one day in Europe might look like this:
You can now multiply your total daily budget by the number of days you will be away. For example, if you were to be gone for one month (30 days), your total cost would be around $1200, just for daily expenses. Then add on your initial costs to get your total budget:
|daily budget x number of days + initial costs = total budget|
Remember that these prices are only an example and that your daily budget will be an average. Obviously you won't be paying for museums everyday, but $5/day is a good average. Prices are so variable everywhere you go that a daily budget could be half this (or double). Check your travel guide to get a good idea how much your accommodations might cost. They usually list visa prices as well. And don't forget to allow for any extra expenses.
Except for sight-seeing and museums, many expenses are unavoidable. The difference is how much you spend on each.