Budgeting For Backpackers: The Financial Guide

Real Travel

15 Jun

One of the most frequently asked questions of backpackers is, “How can you afford to travel so much?” The more you travel, the more you get posed this question. The ironic thing is, many people don’t realize that traveling can actually be cheaper than everyday life back “home.” In fact, on average, we’ve spent less money per day traveling for the past three months than we did while living on a Caribbean island. That being said, there are plenty of tips and tricks to traveling on a budget and saving those cents. So, no gatekeeping here. Stay for a while and learn how you too can travel the world, spending less in a month than you currently do on rent.

Please note you might find affiliate links and ads on this page. We are also not Certified Public Assistants (CPA) or offering financial advice. This is purely based on our personal experience and conversations we have had with fellow travelers.

Table of Contents

1. Start With A Number

Before you begin, you should have a number in mind of how much money you will have to spend on your travels. Sure, it might depend on how long you want to travel, where all you will be going, etc., but you should have a rough idea in your head first. This number should be realistic, plus around 5-15% as a safety net. You can start with about how much you spend per month on living expenses at “home.” While it’s possible to spend less, and much more, I’ve spent an average of 1.400€ / $1,500 per month, all inclusive. Once you have this number in mind, determine if you already have it, or if you need to work a bit before you reach that goal. Over ninety-percent of travelers I have met do six-month rotations of working to save and traveling, so don’t feel bad if you can’t book a ticket immediately. Most of us don’t have money trees.

2. Make Your Priorities

This is a very personal question. What are you willing to spend on different things? Some people prioritize eating out and evening drinks, others prefer nice accommodations, and some want epic activities and sightseeing every day. Ask yourself what exactly you will want to spend money on, then how much you are willing to spend on each of those categories each month. If you are slow traveling, just remember that you don’t have to do everything and there is plenty you can do for free. Ask yourself questions like:

What could I do without for an extended amount of time to make ___ work?
Would I be upset with myself if I spent too much money on ___ today?
Am I willing to go without ___ so that I can ___?

3. Create Ideal Percentages

Once you have a starting budget number and your priorities set, now you need to set aside a certain percentage of your monthly allowance to each category. Below you will find our personal ratios, which you can use as a reference and starting point for creating your own ideal percentages.

• Food: Groceries (20%) and eating out (15%)

• Transportation: Big tickets (15%) and public transportation (10%)

• Accommodation: Hostels (15%)

• Activities and Sightseeing: Museums, activities, etc. (15%)

• eSim: Data plan (5%)

• Shopping: Souvenirs and items on an as-needed basis (5%)

Money is a big uncertainty for many people with backpacking, which we even addressed in another blog dedicated to travel concerns that you can read here. But rest assured, you can do this. We promise. This is one of the first moments you will need to start adjusting your target total budget. Once you create your percentages, actually calculate out what the dollar amount will be, based on the number you created earlier. If it doesn’t seem realistic, reevaluate and determine a better percentage, or add money to the budget. It’s okay if you need to adjust. You will find the sweet spot between wanting to do more than is realistic and doing everything that you want without regretting anything. Being under-budget is way better than spending more money than you expected. We love to use the Travel Spend app to keep track of our spending and have an easy-to-see breakdown of each category we are spending in.

4. Accommodation

One of the biggest categories of budgets in general is accommodation. As a backpacker, we highly recommend you get used to hostels. Budget hostels. And or, stay with friends… you will meet so many amazing people while traveling that invite you to their home countries it’s crazy! Also, you can find free accommodation by volunteering, which we will discuss next. The more you travel, the lower your standards will become. Some might view that as a bad or negative thing, but we choose to see it as a sign of growth. You are becoming flexible, resilient, and able to withstand much more than you ever expected. We don’t want it to seem like all hostels are disgusting hole-in-the-walls, because that’s absolutely not true. But that said, you won’t get turn-down service, 24/7 room service, and a five-star dinner included. You’ll learn that a bed, shower (hot or cold), and place to keep your things during the day is really all that it is. You adapt.

5. Volunteering

Volunteering can be a wonderful experience for you and your host. It has been a great way for us to make deeper connections, learn more about the culture, and get free accommodation. There are multiple ways you can go about getting a “work-stay” experience. Some of the smaller hostels will offer a sort of program where you can help clean the hostel, make the beds, etc. and stay for free. This usually requires a minimum stay of three to four weeks. Alternatively, if you want something more secure and reliable, programs such as Worldpackers and Trusted House Sitters (here for 25% off) offer various opportunities for free accommodation. Worldpackers has hundreds of experiences to choose from, volunteering 12-30 hours a week in exchange for free stay and possibly other perks, such as free meals and transportation. Trusted House Sitters is a program where you volunteer your time and love to house and pet sit for people while they are on their own holidays. Both of these options are excellent ways to reduce cost, have a reason to stay in a place longer, and form better connections with a place and people.

6. Make Money Traveling

The golden question of travelers: “How do you afford to keep traveling?” The most traditional method is work-travel-work-travel. That requires a home-base, or at least a visa that allows you to work in various countries. But is it possible to make money while traveling? Absolutely. Is it possible to make enough money that it’s sustainable and doesn’t require a return-ticket home? That depends on how much effort you put into it. The following money revenues are options and opportunities to digital nomads:

UGC: User generated content is essentially companies paying for pictures, videos, reels, etc. from customers to use as their own marketing material. Check out sources such as Cohley, Trend, Collabstr, and Popular Pays.
Selling Digital Products: If you have destination guides (such as ours that you can find here), itineraries, ebooks, etc., or really anything that you have extensive knowledge or experience in, you can sell it online. The great thing about digital products is it’s passive; you create the product once, publish it, and passively make money on it. Check out Thatch, Rexby, Canva, and Fast Spring.
Hosting Webinars / Workshops: If you are an expert in something, especially something you can teach virtually, why not make money off of it? You don’t even have to do live webinars. Record yourself and create a video course. Create a membership or subscription site. Check out platforms such as Patreon, Streamyard, and Webinarjam.

Online Teaching: Alternatively, if you have the availability and steady-enough internet connection, you can teach a number of subjects on platforms like Preply. This requires more time and dedication, but it can be very fulfilling to create connections with your students.

Affiliate Marketing: This isn’t going to make you rich or fund your entire travel plans, but it’s supplemental income. Amazon Associates, Share A Sale, LTK, and Travel Payouts all allow you to make percentage-based income on sales made through your links.
Brand Sponsorships: This is, unfortunately, only a real option for those with a substantial social media following and community engagement. Working with brands and companies takes a lot of time, dedication, and correct pricing. Negotiation is a crucial factor, so bring your A-game to the table if this is something that you seriously want to pursue.

Takeaways

Money is a sensitive subject, but it’s what makes the world go ‘round. Figuring out how to travel without breaking the bank is also one of the first questions people ask when trying to make their dreams a reality. Once you have a number in mind, priorities clear, and ratios established, it’s all about finding the right accommodations, looking into volunteer opportunities, and learning to make money while traveling. While budgeting is a very personal thing, and everyone’s priorities and plans are different, hopefully you will find these tips and tricks to be a great starting point for you to take the leap and book that ticket. If you find any of this useful, let us know! If you have questions, comments, or concerns, share them! Our goal is for this to be a platform for like-minded travelers to share and help others. If you follow us on Instagram, Facebook, and Threads, you will find that’s the easiest place to interact with a community of wanderers. On our YouTube channel, we will share tips, tricks, and lessons learned from each destination we go to, and our podcast will have similar content in a different format. We hope that you find this information helpful and use it as a starting point for your own wonderful, magical adventures! Happy wandering.

Guide

Trinity Tew