Managing your Budget

The serious business of beer-tasting.

One aspect of travelling that a lot of people find intimidating is facing the fact that you are going to be spending money, quite possibly a lot of it. Don’t let that thought deter you! Instead, use your concern to your advantage. Anxiety is easy to overcome with a little preparation and planning, and being a little concerned will hopefully ensure you go above and beyond when it comes to planning your budget. This page will be dedicated to sharing advice on budget planning and our own experiences with actually following the plan.

Let’s Start Broad:

1. What are your needs?

A good place to start is to figure out what kind of travel you would enjoy. Do you enjoy eating out every night, or do you enjoy learning to cook with unfamiliar ingredients found at the local market?  Are you more concerned about comfort and privacy, or about saving money? Really think about this. An easy way to put a damper on a trip is to find yourself miserable in a hostel when all you really wanted was a quiet, private hotel room to go home to at night. Or vice versa, don’t play it safe and splurge on a hotel room in a well-known area when you know you’re going to be lonely and bored! Think critically about what you need to have an enjoyable trip.

2. Where and when are you going?

Keep in mind, staying in a hotel won’t always break the bank nor will hostels always be as cost-effective as you’d anticipate depending on the country and time of year. This brings me to my next point: figure out where and when you would like to go! That part is fairly obvious, but it obviously defines your trip and possibly what attractions you have available to you. Countries vary in whether most of their sites/attractions are open seasonally or year-round, so do some research and consider what you would really like to see. Prices (and availability) of hotels, hostels, transportation, etc. can fluctuate to a dramatic degree depending on the time of year for countries which depend on seasonal tourism, and even depending on day of the week in some more business-travel-oriented cities.

3. How long are you planning on traveling?

Again, this seems pretty obvious but there are a couple of reasons why I single it out. First, the most obvious reason for this point is that it dramatically influences your budget when it comes to the basic necessities (food, shelter, etc.). Second, it affects how much time you have to devote to seeing each site and also how much you can potentially have a chance to see over the whole trip. Third, knowing your time frame can help you look for great money-saving opportunities. It may not make a big difference if you pay individual bus fares versus getting a pass for a three-day stay, but you can often save yourself a fair bit if you know you’re staying a month. As well, you can look into accommodation options which only open up if you know you’re staying for a longer period of time. This could include renting an apartment or volunteering/working for a free room.

Okay, so now that we have figured out your needs as a traveller,  where you’re going, and how long you’re staying, let’s move on to budgeting your trip!

Start with Categorizing Aspects of your Trip:

What are you going to be spending money on? Likely, your list will look similar to the following:

  • Pre-departure expenses (travel insurance, medications/prescription records, vaccinations, passport expenses)

  • Transportation (to and from the country or countries you visit, within the country if you’re visiting multiple cities, within the cities you visit)

  • Basic daily necessities (food, accommodation)

  • Souvenirs and gifts

  • Treats and trying fun things you stumble across

  • Sight seeing! (guides, entrance fees, travel to and from, tours)

  • Unexpected expenses (use your imagination!)

Pre-Departure Expenses:

This is largely dependent on where you’re visiting, your current health, age, and a whole variety of other factors. In my opinion, and from my own experience, I never like to skimp on this part.

Your passport is essential, it’s an internationally recognized piece of photo identification. While in some instances it may not be required, for example an EU national is not required to have a passport when travelling from one passport-free Schengen EU country to another,  between many countries you are required to present a valid passport when crossing the border.

Make sure your bases are covered in terms of your health. I always purchase travel insurance coverage. I have never needed to use it, but I always feel  more relaxed abroad knowing I’m covered should something ever happen. I am also a huge advocate of vaccines. I always visit my doctor and research travel advisories when planning a trip abroad to determine if there are any vaccines I need. As well, speak with your doctor about any medications and/or medical records you should have with you in your travels.


So where are you going? Do you need to fly? Train? Bus? Are you visiting multiples countries and/or cities? How are you planning on getting around within cities? Often one of the biggest expenses in travelling is transportation, especially when going overseas.

Start by budgeting what you need to get to and from the country you’re visiting. If you’re visiting a few countries or a few cities, plan out a route and budget what you need to travel between each. Do plenty of research and explore your options to work out what works best for you. If you are tight on time, flying across the country might be your best option. If you have a bit more time to work with, taking a bus or train may be a more cost-effective and adventurous option! Ferries, ride-sharing, and renting a car are all great options as well. See if you can save money here and there by buying passes versus tickets or in advance versus on-board. Within cities, look into your options. How are the public transit systems? Are taxis a good option? Or renting  car?

Basic Daily Necessities:

You need to sleep, you need to eat! Go back to thinking about what you need as a traveller and start comparing online. Often you can check things out online to compare the cost of an average restaurant meal versus basic grocery items. For accommodation comparing prices is even easier.

In addition to comparing between hotels, hostels, apartments, and bed and breakfasts, see if you can save money by booking ahead or booking longer stays. Keep in mind, most hostels offer private rooms which you can book. Think of these as a private hotel room minus the frills. They’re usually cheaper than hotel rooms, but still allow you  a private space to come home to while easing anxieties you may have about sharing rooms with strangers. Plus, most hostels have shared spaces you can still utilize to meet new people and make new friends. Consider the pros and cons of all your options, read reviews, and critically look at what your needs and wants are for when you’re out of your element.

Souvenirs and Gifts:

One of the funnest parts! Personally, I love to look into some unique snacks, liqueurs, and products in each place I’m staying. The easiest way to budget out this part, however, is to simply set aside a bit of money for each person (if any) you would like to buy gifts for and for souvenirs for yourself.

Treats and Fun Things:

Set aside a little extra, and let yourself enjoy exploring all the delights of being in a new culture!


Figure out the main sights you would like to see. Do they have entrance fees? Do you need a bus to get there? Is it worthwhile to go on a tour? Sometimes if you’re visiting multiple sights that are out of the way it can be cheaper, and more informative, to opt for a tour rather than to guide yourself. After you’ve budgeted out the main sights you would like to see, don’t forget to add on some extra money. You are probably going to stumble across attractions you hadn’t researched and you don’t want to miss out! Also, check out if there are any programs which allow you to see multiple sights using a single card or ticket. These can be great money savers and can clue you in to museums or other attractions that aren’t as well advertised!

Unexpected Expenses:

Things are always going to come up. Don’t find yourself coming up short because you didn’t account for the taxi you needed when you got caught in the middle of nowhere after the buses had stopped running for the night. Budget a flat amount that you think should be a reasonable emergency fund, and leave your worries behind!

Mock Budget:

Here is a mock budget based on our Iceland 2010 trip:

Pre-travel expenses

  • Passport: about $50

  • Travel insurance: about $30


  • Flight to and from Canada: $850

  • Travel between cities: about $200 between buses and ride-shares

  • Transit passes: about $50

  • Extra: $100

Basic daily necessities:

  • Food: about $20 per day x 21 days = $420

  • Camping: $10 per day x 21 days = $210

  • Extra: $200

Souvenirs and gifts:

  • $100

Treats and fun things:

  • $200


  • The Golden Circle tour:  about $100

  • Blue lagoon: $80

  • Hiking: about $20 for bus tickets to remote hikes

  • Reyjavik Welcome Card: $40

  • Other museums: $150

Unexpected expenses:

  • $200

Total budget for a 21-day trip to Iceland from Canada: $3000

We actually ended up spending about $2500 per person, which is great! We come out of our trip feeling good because we didn’t spend as much as we had thought, and we had an awesome time without skimping on any experiences!

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