YNAB BLOG

How To Budget While On Vacation

"How to budget on vacation" "vacation budgeting" "Europe on a budget"I had told you about how we just got back from Europe, and Sarah in the comments had asked: “How did you track your expenses while on vacation?”

So my husband and I got to talking about it, and, using much of what he commented back to Sarah with, we came up with this post.

While it’s a challenge, keeping to a budget on vacation requires a LOT of preparation and foresight. We’ve now gone to Europe three times on a YNAB budget, and at this very moment I’m sitting in a cabin in Taos on another vacation. (I plan on telling you next how I manage my travel addiction.) So hopefully this will help in Europe or wherever your heart takes you next.

1. Before you purchase anything, know your conversion rate!

It’s not board game money, as much as you feel like it is. It’s real money; trust me. If you don’t want to do the math, then get an app for your phone that can do it for you.

2. Pay for as much as you can while you’re still home.

If you plan on traveling by train or bus once you’re there, then buy the tickets as early as they’ll let you. Many of the companies mail you the ticket, and others simply email them. But trust me, don’t wait until the last minute. Also, pay for any shows or tours that you plan on going to in advance. This helps a ton.

3. Check the admission prices on the websites of everything else you plan on attending and public transportation passes, and budget for all of those.

I made the mistake once of just estimating what I thought the museum admission prices would be, and it ended up being about 2-3 times more. If you spend a couple of days at home on your itinerary, you won’t regret it. You don’t even have to nail down the itinerary day by day, just list the things that you definitely want to do, and then plan then play it by ear, planning around the events that are set in stone. Also, do a search on the public transportation of the cities that you’re going to so that you can maximize on the passes that you’ll surely want to buy.

4. Give yourself a budget for gifts and souvenirs, and get cash out for those.

Once you have your cash, then use an envelope system for this. Keep you cash safe in a money belt or traveler’s wallet. This will also keep you from making regrettable impulse buys.

5. Give yourself a per diem for food and use cash.

Again, you’ll want to use the envelope system for this, keeping the cash safe in a traveler’s wallet or money belt. Also, be sure to do an internet search for what is customary tipping procedure. You may end up saving a little dough that way.

6. Make sure you and whomever you’re traveling with all have a chip in your credit/debit card.

If you don’t already have one, get this sent to you a few months in advance of your trip. Many vendors, especially in Eastern Europe, don’t take a credit card with a swipe. This prevented me from renting a bike one day because each of us needed our own card to register, so it was a major bummer. See http://en.wikipedia.org/wiki/EMV – the US will be doing this very soon. (Tip: Call your credit card company and bank before you leave to let them know you’ll be overseas.)

7. Give yourself (if possible) a few hundred dollars of buffer so that mistakes or minor emergencies aren’t a big deal. You’re on vacation, and it’s awesome, and you don’t know when you’ll get to come back, and that this doesn’t happen every day, so you don’t want to be stressing out about money! A buffer will ease the stress as long as you don’t rely on it too heavily.

8. Download your transactions every night.

Any credit card/debit transactions will show up almost immediately as converted into dollars, so if you’re doing a best guess conversion during the day, at night you can look at your pending transactions and you’ll see those transactions in dollars. Make sure you use a credit card that doesn’t charge you a huge conversion fee (we use the Barclay Travel card because of its rewards and for this reason too).

9.  Use Yelp or Trip Advisor to find places to eat out of the tourist areas to save money.

If you do this beforehand, it’s great. But if you don’t, you might consider getting data on your phone to make things easier (you can buy a prepaid SIM card while you’re there that’s pretty reasonable), but we managed to find enough places with free Wi-Fi to get the information we needed (the Trip Advisor app was my favorite). A lot of times you can end up going a few blocks outside of the normal tourist trap and get something more authentic and much cheaper. So I’d recommend looking at your itinerary now and finding options for where you’re going to be. I think the most expensive aspect of our trip was the panic-and-eat-out-at-a-tourist-trap scenario.

And as far as the nuts-and-bolts of your categories and whatnot, that’s up to you. We just had one category with a simple list of the budget in the notes. Some of you will probably want a master category with sub-categories for each thing (food, souvenirs, etc.), and that’s fine, too. My personal taste is to keep it a little simpler.

I hope this helps! Happy travels!

12 Responses to “How To Budget While On Vacation”

  1. Jane Knight

    Hi,
    If you are visiting London get the City Mapper app for iphone. It is brilliant and has saved me a lot of money by giving me bus routs between sites. I live in the UK and always had to use the tube or walk before this. Also works in Paris and Berlin
    Jane K

  2. Robin

    The only thing I would note is that for Europe at least, it’s actually not the best idea to get all your bus/train tickets ahead of time, and for many, you actually can’t purchase ahead of time (especially for local trains). Times change frequently, and I would only purchase ahead if you are trying to make a reservation in a first-class car on a train that allows purchases ahead of time (overnight trains should be booked ahead as well). It really all depends on where you are going and what you will be doing.

    When we were budgeting for a big Italy trip, I created a complete trip budget on an excel worksheet, making sure to have a category for every single thing we would be spending money on (and truly, every single thing I could think of that might come up to be safe), and trying to actually over budget as much as possible to give plenty of leeway. I found that to work very well for us, as there were some categories we had over budgeted (and had extra money from) but also categories we had under budgeted, so they all kind of evened out in the end. I just kept a notebook with a running list of major expenses (hotels, trains, etc), and we tried to use our cards as little as possible, taking out cash along the way, to make it easier to keep track.

    And yes, museums and sightseeing can easily end up costing more than you think, so it is important to find out those costs ahead of time (and really, for the major sites/museums, those should be booked ahead of time anyway, because you don’t want to spend precious vacation hours, and I do mean hours, standing in line for tickets).

    Also, locals are the best ones to ask for where to go to eat-they can steer you in the right direction :-).

  3. Bruce

    We just got back from a US trip with some driving and some flying. I had no way to tell in advance what costs would be except the one hotel we stayed in (mostly with family), so I overbudgeted. We did download each day’s transactions and entered receipts with the smartphone. I used a memo hashtag for the three separate events during the vacation to see what each cost later. Finished below budget by a fair amount, now using it to WAM needed car maintenance after the driving.

    • michaelh

      Great idea on the hashtag in the memo. I can think of a lot of ways that will come in handy

      • michaelh

        Well the key problem when facing how to organize YNAB is how many categories you have. You generally want few categories, but sometimes you want to drill down in the data more. For example if I want to ask, out of my fun money, how much am I eating out? I can put a #eatingOut on each txn I eat out, and I still get to have just one category to manage. Similarly if I have a “home projects” category and want to know how much each project costs, I can have #deck, #painting, #flooring and total it up that way. It’s not something I would use a lot but it will help me in these situations where I’m trying to observe a short-term trend to see if behavior needs to change.

  4. Lindsey

    Don’t forget to tell your bank and credit card that you will be traveling and the dates so that they don’t flag a security stop on your account. Both my cards have a way to do this online.
    I agree with Bruce on the memo, I tag each expense with a memo saying vacation or travel, so that I can filter and find a total expenditure.
    Chip and pin cards are a must as you mentioned, I’ve had some cashiers in stores don’t know how to cope with a swipe card.
    Make large ATM withdrawals to minimize how many you have to make as you can get hit with international fees each time.
    I’m looking forward to your post on how you manage your travel addiction, as I too enjoy this problem.

  5. smeisner14

    I’ve taken two trips since starting YNAB. The first I stayed at a friend’s house, so essentially I only had to pay airfare, food, beverages, and entertainment, so I just did one lump sum and didn’t think too much about anything. I have a separate category for airfare so that didn’t even factor in.

    My more recent trip included hotel, gas, food, drinks, and entertainment. I didn’t want to be short when it came time to pony up for hotel, so I did a master category with those subcategories. My biggest problem was forgetting to input transactions after a few drinks (oops!), but overall this worked out very well. I think I even came in under budget (even with the forgotten bar tabs).

    Can’t wait for the post on travel addiction! Like I said, I have a category strictly for airfare, and I’m constantly feeding it even if I have no solid plans to go anywhere. But I do live in Alaska and try to make it back to Nebraska about twice a year, and those ticket prices are nothing to sneeze at!

  6. Amanda

    Vacations are one of the reasons we were shopping for budgeting software and chose YNAB. I am hoping being able to enter the purchases on my phone will really help. We won’t be dealing with conversion rates so it will be easier. Last year we went to Florida for 10 days and I was stressed that I didn’t have visibility of what we were spending. Planning to go to Disney 2015. YNAB will be going with us.

  7. Beth Anne

    I’m torn on the “pay for as much as you can before” thing because we recently went to Europe and prepaid for a bunch of tours that we barely used or couldn’t find or really weren’t that good.

    I wished we hadn’t bought a lot of them and saved ourselves the $500 or at least have spent the $500 on tours we actually were looking for and didn’t frustrate us or make us get lost in the process.

    For my Europe trip though we had bought everything but basically food and souvenirs before we left. We had an idea of how much we had to spend and we spent a little more than we wanted but it wasn’t that bad.

    I recently went on a weekend trip and used my ynab app to record everything which was good and helpful.

    • michaelh

      Yeah the key I think is to know what you value on a trip. It took us a few times to realize that we didn’t need tours, we just needed to plan in advance, and that we really like museums and the headsets that curate for you in English. We also don’t like the touristy places.

      Another concern of mine is the prepaid can be overcharged when you’re doing it in English. For example we got a much better rate walking up to the train station and buying a ticket from Prague to Vienna than we would online. So I agree with you it’s not black and white.

      I’ve also thought of doing a trial run trip to something close (for us it’s Austin) where you see what you value and like. Did you like the museum? The botannical garden? Spending the afternoon at a park? A tour? Getting to know yourself when things are cheaper is much better than figuring it out when you’re halfway around the world and only have a few days.

  8. AJ

    I don’t necessarily agree with prepaying as you can often find cheaper deals or change your priorities when you’re there “on the ground”. Plus it locks you into an itinerary, which I hate. In fact I go against the whole “plan it all before you leave ” approach as half the fun is changing your plans along the way!

    For YNAB I use a single payee (e.g. “Germany July 2014″) for each trip and just put everything under there. Then I put a note about the real payee on the memo if its important (usually not).

    Small trips go into a single “Trips away” category and larger ones use a dedicated one which I recycle, changing the name to reflect what I’m currently saving for.

    Using this system I can easily see how much we spend on travel from the categories and on specific trips from the payees. I don’t really care about the actual payee and breaking up travel expenses by sub-category also doesn’t add any value for me personally.

    Possibly not the best system for everyone but if you travel a fair bit it’s quite easy to use without getting bogged down on unnecessary detail..

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