Finances are often the biggest hurdle to travel. Everyone has a trip they dream about taking, but too often, that once-in-a-lifetime vacation seems like a faraway dream.
Well, I’m not here to tell you that it’s super easy to save money for travel. It’s not. It will take diligence, commitment, creativity, and compromise. You’ll need to learn to stick to a budget, live below your means, and you may have to give up some comforts either at home or on your travels – or both. But in return, you’ll be able to spend more time traveling, creating memories and having incredible adventures and experiences. Travel is usually my third largest annual expense after rent and food – and it’s my life’s passion.
It took me five years to save up enough money to quit my job and travel the world for a year – and it was well worth it! (If you’re considering doing the same, I’ve sprinkled a few long-term travel tips into this post – but I highly recommend reading my book: How to Quit Your Job & Travel.)
In this post, I’m throwing all the tips I’ve learned from years of saving money for travel. You’ll learn how to calculate the cost of your dream trip, how to budget for travel and cut expenses at home, and creative ways to earn extra money for travel.
Looking for more practical travel tips? Take a look at some of our other posts:
READ THIS POST
How to Plan a Trip: The Ultimate Practical Travel Planning Guide
About Our Financial Backgrounds
Before I dive into how to create a budget to save for travel, I want to give a little bit of personal insight into each of our financial situations. Finances are incredibly personal, and it doesn’t seem fair to give advice without disclosing what our advice is based on.
Jeremy and I come from very different financial backgrounds. Jeremy was the first in his family to go to college and lived paycheck to paycheck for his entire life, but I grew up comfortably. And while I spent much of my childhood experiencing travel on family vacations, Jeremy’s family had never been able to afford much travel: in his entire life, he’d never left the West Coast.
Our backgrounds in financial literacy were also vastly different. I learned about budgeting and saving from an early age. My parents even opened a credit card in my name for me when I was a teenager so that by the time I graduated college, I had a near-perfect credit score and was able to immediately begin racking up credit card rewards, which helped pay for parts of my year-long honeymoon.
When it came to college, my parents were able to provide me with the incredible gift of graduating from college debt-free, thanks to their diligent savings and investments. But Jeremy did not receive very much financial help or advice, and made what he now realizes was the mistake of attending a predatory for-profit college. He got a degree and learned skills which he still uses, but he also has a massive amount of student loan debt split between both private and public loans.
I want to be very clear about acknowledging my financial privilege. I did not pull myself up by my bootstraps, and I am not self-made. I owe the fortunate life in which I now find myself to not only the family who came before me and carved out the life that I now enjoy, but to a series of systemic benefits that served to boost me up every step of the way.
The fact that I was able to save up for a year of round-the-world travel in five years is not due to my own cunning brilliance: it’s due to a series of systemic benefits and plain good luck working in my favor since the day I was born.
If you didn’t experience the same financial privileges as I did growing up, I’m not going to tell you that it’s possible to pay for travel just by giving up a daily $5 cup of coffee that you might not even be able to afford in the first place.
But what I do know, through watching Jeremy painstakingly clean up his own messy finances and establish good spending habits, is that financial literacy can be learned at any point in your life.
What I want to do in this post is share some of the financial tools and skills I’ve learned over the years to help you set a budget, which will tell you whether saving up for a trip – especially a long-term trip – is feasible.
If the numbers aren’t working out in your favor, I can also assure you that saving up in advance is only one way to pay for travel, especially for a long-term trip. You can always work while you travel, or work in exchange for accommodations with services like Trusted Housesitters, WWOOF or Workaway.
READ THIS POST
How to Be a More Responsible Tourist: a Traveler’s Guide to Ethical Tourism
How Much Money Do You Need to Travel?
The most helpful way to estimate how much a trip will cost – and how much you’ll need to save for it – is to figure out how much you’ll be spending on average per day. To make a few sweeping generalizations, here are some off-the-cuff estimates:
- $25/day: This is considered shoestring travel, and you’ll likely be staying in hostels, housesitting or couch-surfing, cooking most of your meals, and doing lots of hikes and other low-cost, self-guided activities. A weekend camping trip is a great example of inexpensive travel!
- $50/day: Depending on the destination, this is either a mid-range budget for a low-cost destination like South America, or a shoestring budget for a pricier destination, like Western Europe. You can generally spend $50/day by staying in hostels, cooking most meals, and booking only a select few tours.
- $100/day: This is a pretty comfortable budget for many parts of the world, but for Western Europe or the US, you’ll still need to make budget-friendly choices when it comes to accommodation and dining.
- $150/day & up: You can probably afford a boutique hotel, a few tours, and plenty of eating out in most parts of the world on this budget! This is also closer to what you could expect to spend on a trip to an expensive destination like Disney World or most of California.
That said, in order to accurately estimate how much your trip will cost, you’ll need a few key pieces of information.
- Where are you going? Certain destinations, especially in the US or Europe, are quite expensive. But there are beautiful boutique hostels in South America or Southeast Asia with private rooms for under $20 a night — breakfast included.
- How long is your trip? Typically speaking, the longer the trip, the more expensive it will be. There’s a big difference in saving for a week-long getaway versus a year-long round-the-world trip (and we’ve done both.)
- What’s your travel style? You’ll need to be honest with yourself about your comfort level and your expectations.
When it comes to long-term travel, your financial situation will determine everything from where you’ll go to how long you’ll be able to travel to how much “roughing it” you’ll do to whether you’ll need to work on the road.
The concept of traveling on a shoestring budget for less than, say, $25 a day – is difficult or downright impossible to do in the most popular vacation destinations for those from the USA – think resorts on Caribbean islands, Western European cities, Disney theme parks, and so on.
Without experiencing just how inexpensive travel is in certain places, it can be hard to imagine how you can travel on a $25/day budget. But that’s quite possible depending on where you’re going and what you’re comfortable going without!
After all, the difference between a luxurious vacation and an inexpensive backpacking trip is really just a difference in expectations and preferences for comfort.
For a backpacker or a long-term traveler, comfort and luxury become relative. “Luxury” could mean in-room A/C, drinkable tap water, a beautiful view outside your window, beach access, or the blissful quiet of a private room – all of which can be found in inexpensive hostels worldwide (just spend a few minutes browsing Hostelworld and you’ll see what I mean).
And you may find that a few comforts or luxuries are worth forgoing if it means traveling for longer, or being able to afford a once-in-a-lifetime experience, like a guided trek through the Himalayas or a week in the Galapagos Islands.
So before you open up a spreadsheet and start planning your trip budget — although I can understand your enthusiasm, because that’s my favorite hobby — you’ll need to do some soul searching to figure out what kind of traveler you are.
You’ll want to figure out what you need to feel safe and comfortable — the things you can’t do without, which are worth the expense — and what is less important to you.
Takeaway: The amount of money you’ll need to save up to travel depends on where you’re going, how long you’re going for, and where you’re willing to splurge or save.
What’s Your Travel Style?
There are certain areas that I’m more willing to splurge on – and some that I just can’t justify. For instance, I always budget travel insurance into our trip costs, because I’ve had enough mishaps to know that I need it to feel safe and comfortable while traveling internationally (read more about why I recommend travel insurance).
Before I stayed in a hostel for the first time, I wasn’t sure how I’d feel about sharing a bathroom with strangers. Frankly, it sounded annoying and honestly, kind of gross. Was I really willing to give up my privacy?
But I soon learned that hostels are lovely places to stay, full of fascinating and friendly travelers, and they usually have the best recommendations for things to do and see in town.
I realized that the things I’d come to take for granted in my life back home had been luxuries all along; expectations that came hand in hand with a Westernized standard of life I’d never questioned or been without. I learned that being able to leave your own toiletries scattered around was a luxury I was comfortable doing without. I also made my peace with sleeping in shared rooms, so long as there was a secure locker near my bed that I could store my belongings in. (That said, over the years I’ve grown to prefer private rooms in hostels over dorms.)
However, while I like to consider myself a budget traveler, I’m willing to spend more money on certain things – mostly involving food. Like, Jeremy and I once dropped $200 at one of the best restaurants in the world (Central in Lima, Peru) before returning to our hostel to sleep in a crowded dorm room. For the record, it was WELL worth it.
For Jeremy, adrenaline-inducing activities are worth the extra expense: things like scuba diving, white water rafting, canyoning and horseback riding. (Luckily for our budgets, I discovered that I hate all of those things).
In truth, we’re more of mid-range budget travelers: we balance our appetite for fancy food and pricey adventure sports with our willingness to sleep in inexpensive hostels, fill up on free breakfasts in order to skip lunch, and take extremely long overland journeys by bus.
Ultimately, only you will know what you’re comfortable with. So take whatever you’re unwilling to part with (Privacy! Great food! Good WiFi!) and work that into your budget. You may need to save up longer to accommodate for your personal preferences, but it will feel worth it to have the trip of your dreams.
Takeaway: Some travel styles are more expensive than others – but only you can decide what you’re comfortable going without, and what’s important to you to spend more on.
READ THIS POST
Is Travel Insurance worth it? Here’s Everything You Need to Know
How to Calculate the Cost of a Trip
Once you have a rough idea of where you’d like to go on your dream trip and the style of travel you’re comfortable with, it’s time to start calculating.
This is where things get sexy. Go on — put on your favorite pair of computer glasses, pop open a bottle of wine, and open up a nice, blank spreadsheet. Maybe throw in some conditional formatting if you’re feeling a little naughty. Is it getting it hot in here, or is that just budget planning? *fans self*
- On your spreadsheet, map out a very rough idea of your itinerary and route.
You don’t have to get specific — you can be as vague as “two weeks in Bali” or “one month in Colombia,” and so on.
That said, the more specific you are, the more accurate your budget estimate will be. I try to list out as complete an itinerary as I possibly can. As I continue planning and fleshing out my trip planning document, I update my spreadsheet to include specifics, such as the cost of a hotel I want to book or a tour I want to take. The picture above shows how I update my budget while I’m in the process of booking it.
- For each destination, estimate out the average daily cost.
I like to use BudgetYourTrip.com, which has up-to-date cost estimates for destinations all over the world submitted by travelers for everything from food and accommodation to bottled water and transit.
You can even select your budget travel style to get an estimate tailored to your comfort level! I’ve found these estimates to be generally accurate – as long as you’re honest about your travel style and preferences.
- Add in the cost of transportation between destinations, including flights.
Don’t skip this step! Flights, trains, buses, and other methods of transportation add up. Start with the cost of round trip plane tickets from your home to your destination for your target dates, or pick some random dates, if you aren’t sure yet. (Budget tip: off-season travel is always cheapest, and that’s usually when the weather is worst.)
For transportation expenses during your trip, you’ll need to do a little bit of itinerary planning. For instance, if you know there are 3 cities you want to visit within one country, I’d recommend adding a line for transportation to each of those cities.
To estimate transportation costs, I like to search on Rome2Rio.com. Put in your “to” and “from” destination and the site returns all of the transportation options, how long each option takes, and how much it costs.
- Add in any special activities that you’ll need to budget extra for.
Certain bucket list activities are worth the extra cost — if your budget allows for it. You’ll want to account for those extra costs in advance so you don’t miss out!
For us, those extra expenses typically include a food tour, a snorkeling or scuba diving tour, and any tickets to must-visit museums or attractions that we’re really looking forward to.
- Add a little padding.
There are always extra, unforseen expenses. For instance, you might want to throw in a line for your travel insurance. Do a quick Google search to see whether you’ll need to pay for visa costs for your target destination — those can add up! (U.S. residents can search for tourist visa requirements and limitations by country on this website.)
You may also need to budget a little extra for medication, vaccinations, and purchasing any gear that you’ll need to get sorted before your trip — including getting a passport if you don’t have one yet – and then throw an extra 10-20% in there, just to be safe and soothe my anxiety.
Voila! You’ve now got a rough estimate of what your dream trip will cost – and how much you’ll need to save up.
If that number looks daunting, you might want to play with your itinerary, the length of your trip, and so on until things look a little more doable.
Now the real question is: how long will it take you to save up for your trip? In order to figure that out, you’ll need to work backwards: divide your target budget by the number of years or months you might feasibly be planning your trip, and you’ll have an estimate of how much you need to save each year or month.
So: is that doable? Wait – before you answer that, let’s take a quick side-trip into the titillating world of financial planning!
Takeaway: To estimate the cost of your trip, create a blank spreadsheet and add up every expense you can anticipate. Using the average daily cost for your destination. Then add in transportation, special activities, and extra unforeseen expenses.
Budgeting for Travel
In order to budget for travel, you’ll need to figure out how much you’re spending each month. To get an accurate idea of how much savings is feasible, you’ll need to know both your fixed costs and your variable costs.
- Fixed costs are specific amounts you have to pay each month, like rent, utilities, your Netflix payment, and bills. The number is predictably the same each month: it’s fixed.
- Variable costs cover everything else, from food (both groceries and dining out) to shopping and entertainment. The total amount varies each month, hence the name.
There’s a very good chance that your estimates of your variable costs are completely inaccurate. Don’t take it personally — it’s a universal truth. (For instance, Jeremy and I like to believe that we spend a lot less money on eating out at restaurants each month than we actually do.)
To get an accurate estimate of your variable costs, I recommend tracking your expenses. You don’t need to write down everything you spend (unless you pay for everything in cash): there are fantastic, completely free tools that you can connect to your accounts and cards to automatically pull in all of your expeneses and put them in handy, easy-to-track categories for yoy!
- Mint.com is a fantastic free resource for tracking your spending, setting a budget, and helping you manage your finances. I’ve used Mint for years and I highly recommend it!
- PocketGuard helps analyze your spending patterns and looks for ways that you can save money, such as better monthly deals on phone bills and Internet service.
- Wally helps you set a budget, track your spending, and manage your payments.
Once you’ve accurately tracked your expenses for a few months, you’ll have a pretty good idea of what you’re spending compared to what you’re earning, the difference of which is how much you’re able to save each month.
Take that savings amount and do some quick math: if you divide the amount of money you think you need for your vacation by the amount you’re able to save each month, how long will it take you to save up for your trip? (If you’re saving for long-term travel, divide by 12 to get your answer in years).
At the risk of sounding like a math teacher, you can adjust your numbers a little bit by changing your variables: the amount of money you need to save, the amount you’re saving each month, or the amount of time you have to save.
Let’s just lean into this math teacher thing and do a quick equation together.
- I estimate that my trip will cost: $3,000
- Each month I can save: $150
3,000 ÷ 150 = 20 months, or just under 2 years.
A long term travel calculation might look like this:
- My trip will cost: $30,000
- Each month I can save: $500
30,000 ÷ 500 = 60, which divided by 12 is 5.
So if I need to save up $30,000 and I’m able to set aside $500 each month, it will take me 60 months/5 years to save up for my trip. (And yes: those numbers are roughly what I used to save up for my year-long honeymoon).
Now, if I want to leave sooner, I’ll either need to increase the amount I’m saving each month, or decrease my savings target.
Decreasing your savings target means you’ll either need to adjust your travel budget style or shorten the length of your trip (back to your spreadsheet! Grab the wine!). For long-term travel, it may also mean you’ll need to commit to working during your trip.
To increase the amount you’re saving each month you have just two options: you can either spend less, or you can earn more. (Boy, it sounds like a real piece of cake when I write it out like that, doesn’t it?) Read on, because I’ve got tips for both!
Takeaway: Track all of your spending for a few months to get an accurate idea of your spending, and then create a budget you can stick to. Knowing your monthly spending will give you a monthly savings amount, which you can use to calculate how long it will take to save up for your trip.
How to Save Money for Travel: Reduce Variable Expenses
It’s much easier to cut your spending if you’ve got lots of surprising variable expenses — money that you’ve been spending without realizing how much it adds up. If you have a lot of unnecessary variable costs, you’re in a great position to start saving up money. You can:
- Reduce your food spending by eating out less and cooking more (cooking big batches of food on the weekends and meal planning will help!)
- Make coffee at home instead of stopping at Starbucks
- Carpooling, biking, or taking transit to work a few days a week
- Cutting back on late-night impulse buys on Amazon and Friday night trips to Target
Of course, you’ll want to tighten up your spending across the board to really make a dent.
But even cutting out that before-work $5 latte in favor of making coffee at home will save you $1,300 per year, which will buy you 1.5 weeks of island-hopping in the Galapagos (yes: all of my savings math is counted in South American travel experiences) or an entire month of backpacking in Colombia for two people, which is definitely worth it.
Whenever I’m tempted to buy something I don’t really need, I like to remind myself that I can get a room in a hostel in South America for under $10.
For me, building up my savings required a combination of cutting down on my both variable expenses and my fixed costs. I decided that paying for my Very Big Adventure was well worth the tradeoffs of living in a smaller apartment, cooking most of my meals, ordering soda water at bars, and spending adventurous weekends camping and hiking instead of staying in pricier accommodations.
Takeaway: Variable costs are the ones you have the most control over, so they’re the easiest ones to cut. Even cutting out just $5 a day, 5 days a week, will save you $1,300 – which is enough for an international trip to a budget-friendly destination!
How to Save Money for Travel: Reduce Fixed Expenses
While I was working on my own savings and getting used to sticking to a budget, I found that most of my expenses were coming from fixed costs like rent and utilities — and I had to make some difficult decisions.
If you’re in a similar position, that may mean shifting your lifestyle to live below your means. Here are few creative ways to start chiseling away at your fixed costs:
If you’re paying off your phone, trade it in for a cheaper version. Switch to a lower-cost phone plan, or split a shared phone plan with friends or family.
If none of those options work, there’s always the old tried and true method: call up your phone provider and (politely) threaten to cancel your service. They’ll usually offer a “retention” discount to keep you as a customer.
If they don’t, cut ties with them and switch to a less expensive phone provider who values your business! (Feel free to put on your best “let me speak to your manager” impression at this point, but please don’t ream out the poor customer service person who happened to answer your call — it’s not their fault).
I’ve called up AT&T to politely ask for a discount on my phone and internet bills so often, their retention line was saved as a “Favorite” in my phone. (By the way: T-Mobile has worldwide free data, so it’s GREAT for international travel!)
If you’re currently paying for cable TV, drop that sucker out of your life — you’ll be amazed how much mindless entertainment you can get from Hulu, Netflix, Amazon, Disney+, and/or HBOMax. Plus, this will be excellent practice for when you’re traveling anyway!
To make things even cheaper, opt to share your accounts with family and friends. Each member of my family pays for a streaming service, and the rest of us mooches just use their login.
Plus, it makes it easier to know who’s watching what so we can text them and ask if it’s worth it. Aww, family bonding over TV — it’s like a trip back in time to the good ol’ days!
READ THIS POST
The 5 Best Travel Pants for Women: Functional, Cute, & Field-Tested
- Reduce your housing costs
Housing costs are usually the biggest expense line in your budget, which means that reducing your monthly housing payment can be a major boost to your savings, especially if you’re able to move your stuff on your own or with the help of friends.
If you’re a renter, check apartment listings in your area frequently to look for cheaper options. You’re looking for smaller square footage, fewer bedrooms or bathrooms, and fewer amenities (for instance, we went without a dishwasher or A/C for 8 years. Great practice for hostels!). I’m a big fan of PadMapper.com for browsing apartment listings.
If you can’t find a cheaper place alone, consider roommates. You can round up a few friends to split the cost of a house with several bedrooms, or browse through Craigslist to see if anyone’s seeking a roommate.
If you’d rather not move and you’ve got a little extra space to spare, getting a roommate will be an immediate boost to your savings — much easier if you have an extra bedroom, of course, but there are a few non-traditional living arrangements you might consider. (Jeremy once split a studio apartment in San Francisco with seven people. He had one corner of the room, separated by a hanging sheet. Comfortable? No. Great training for hostel dorms? Yes!)
Just be sure you do your due diligence with anyone you bring in to live with you: if you’re renting, ensure that you’re not breaking your lease by subletting (it’s much better to add them to the lease so everything’s on the level). If you own your home, conduct a background check and make sure to draw up a lease so you’re legally protected in case anything happens.
Homeowners have a few more options. Refinancing your mortgage may be a good option to reduce your monthly payment or interest rate. You can also rent out your entire home to cover your mortgage, and then move into a lower-cost apartment. There’s a decent chance you’ll have to get a tenant to sublet your house while you’re traveling anyway, so why not do it a little early and pocket the extra cash?
When I met Jeremy, I had just downsized from a one-bedroom apartment to a tiny, 500-square-foot cottage in order to save $150 per month. That $150 per month added up to $1,800 per year, which is $9,000 over the course of five years! That move alone paid for a significant chunk of our year-long honeymoon.
But when Jeremy moved in with me, my cozy little cottage suddenly felt very cramped. There was barely enough space for me and my belongings, let alone Jeremy’s boxes of artwork and film school textbooks. We both ended up getting rid of some of our belongings – and eventually got used to constantly squeezing past one another. And it turned out to be fantastic practice for long-term travel!
After Jeremy totaled my car on a disastrous camping trip, we were able to apply all of our car-related expenses to our travel savings. Living in the Bay Area made going car-free easy: there’s comprehensive public transit, walkable neighborhoods, and shared car services, bike rentals, and scooters are available on every corner. We were able to complete most of our errands without needing a car, and when we did need one – for groceries or just weekend trips – we rented one.
Unfortunately, owning a car is a necessity for most people in the United States. The country is built around driving, and if you’re not living in a major city like we were, it’s downright impossible to go car-free.
That said: if you do live in or near an urban area with public transportation, consider getting rid of your car and getting a bike (electric, motor, or just a good old-fashioned 10-speed). Going entirely car-free will save you from monthly car payments as well as insurance and gas expenses, plus you’ll never have to worry about paying for surprise maintenance or accidents.
When you do need a car — which everyone does at some point — you can join a carshare service such as ZipCar or GetAround, or even just rent a car from a nearby rental company (we use Kayak to find the best deals).
If going car-free isn’t an option, do your best to reduce your car payments. Downgrade to the cheapest car possible that will get you where you need to go. Cut back on driving as much as you can, and carpool whenever possible to save on wear & tear and gas expenses. If you drive less, you may even be able to negotiate a lower-cost car insurance payment.
While it’s definitely a major lifestyle shift, living below your means, sharing your housing, and reducing your reliance on driving will help you build up your savings much faster.
Takeaway: Lowering your fixed costs is hardest, and may require some sacrifices. Try to get creative about ways you can realistically cut your fixed costs. What are you comfortable going without in order to save money for travel?
What About Debts & Loans?
Fixed costs like debts and loans are a little trickier, and require careful strategizing. When you’re paying down debts or student loans, you do have a few options for reducing your monthly payments. But it’s important to keep in mind that the longer you take to pay off a loan, the more you’re paying in total, thanks to accruing interest.
Even though a lower payment monthly is nice for short term, it will end up taking you longer to pay it off and it will potentially add quite a bit more money to the total cost. So, embark on this option carefully: the choices you make now may be screwing over your future self!
If you’re paying off debts or loans, spend a few months calling up your creditors and lenders to inquire about lowering your monthly payments or reducing your interest rate. They’re usually more willing to negotiate with you if you’ve got a good credit score and a history of making timely payments (and also if you ask nicely).
You may even consider refinancing or consolidating your debt to get a more manageable monthly payment – but don’t accept a higher interest rate, if you can avoid it.
Credit card debt is one area that I wouldn’t recommend this approach. Credit card loans are typically high interest, which adds up fast and becomes incredibly difficult to pay down – if you’re paying the minimum amount each month, chances are you’ll be paying it forever, since you’re likely only really covering interest and not chipping away at the actual amount you owe (the principal).
I strongly encourage you to pay off credit card debt before you start saving money for travel. Throw all the extra money you’ve been able to muster up at that credit card debt and pay it off as quickly as you can! And then go treat yourself, because paying off credit card debt is a HUGE deal.
To give you a leg up, you might consider transferring your balance to another credit card with 0% APR for a year. That gives you a whole year to pay down the principal without acquiring more interest, which can make a major dent. But be careful: those deals often come with a massive interest rate once your “free” year is over! Only try this method if your debt is definitely something you’ll be able to pay off within a year.
If you’ve got cash on hand to throw at your debt, you might try offering a lump sum to pay off the rest of the loan – some creditors may be willing to cut you a deal if you’re able to pay them on the spot. This is a great option if you’ve got some extra cash, but when you’re saving up for a major expense like a long-term trip, you’ll need to decide whether it’s worth paying that debt down now or keep paying the minimum on it until you return.
If you need help with setting up a debt management plan, the National Foundation for Credit Counseling and the Financial Counseling Association of America are both completely free, non-profit organizations with resources that can help you set a realistic plan for tackling your debt, with recommended tools and methods to reduce your payments.
The Suze Orman Debt Roll-Down approach is also a fantastic method for paying down debt, which recommends that you start with your highest interest rate first, and as you pay off balances, apply your old monthly payment to your other debts. More about this method, including a calculator to help measure the time it will take to eliminate your debt, can be found here.
Now let’s talk about the elephant in the room for the unfortunate majority of United States citizens: student loan debt. When it comes to student loan payments, the whole “just call up your creditor and ask them nicely to make you a deal” thing flies out the window. Trust me: we’ve tried.
That said, you do have a couple of options to reduce your monthly payments. If you have federal loans, you can enter into a federal loan repayment plan, such as income-based repayment, which ties your monthly payment to your income level. Take a look at the available federal loan repayment programs and contact your loan servicer to discuss your options.
If you plan to quit your job and travel long-term, you may be able to reduce your payments down to nothing, or almost-nothing during your trip. Which is all well and good, but don’t forget: you have to keep proving that you’re not earning any money, or your loans will go into default — which is a major hassle.
Sadly, I speak from experience: we made that mistake during our year-long honeymoon thanks to one single piece of missed mail while we were backpacking through South America. It took us years to clean up that mess.
Private loans are a little tricker, but you may have some repayment plan options: call up your loan service provider to ask.
Another good option to consolidate and refinance your loans using a student loan refinancing service like SoFi. When you refinance, the company you work with will pay off all of your loans, and you’ll owe them money instead. If your loans are all spread out across different companies, this can definitely make things easier, and you may also be able to lower your monthly payment or interest rate.
Takeaway: Reducing your monthly loan payments isn’t actually the best idea, because it means you’ll be paying more money overall. Instead, consider consolidating or refinancing your loans, negotiating a lower interest rate, or even paying down some debt with a lump sum.
How to Earn Extra Money for Travel
Once you’ve chipped away at your expenses as much as you can, the next way to boost your monthly savings is to increase your income.
Increasing your income is the hardest of all. It’s never quite as easy as “just go get a better paying job,” although … that would definitely help. I would love to help wave a magic wand for you and make this step easier, but the best I can do is to give you a lot of ideas!
If you’ve got some extra time, you could take advantage of the gig economy or start a side hustle. (Or you could pick up a second job, but the beauty of a side hustle is that you get to set your own hours and only work when you want to.)
You might consider becoming a rideshare driver for Lyft or Uber, deliver food for Postmates or Doordash, or walking dogs for Rover or Wag. You can become a website tester for UserFeel or run errands for TaskRabbit.
For something a little more old school, you could start working as a Mystery Shopper. You’ll be low-key spying in order to ensure that a company’s guidelines are being met, evaluating things like customer service, whether you’re carded for buying alcohol, or in some cases, even setting up special displays in stores.
There are many Mystery Shopping platforms, each with different clients and opportunities. Start with Market Force, Intelli-Shop, Sinclair Customer Metrics, and Best Mark. My two top tips from years of mystery shopping are to batch all of your mystery shops together so you don’t have to drive as much, and complete and submit your survey paperwork directly after each shop (like, in the car before your next stop) so you don’t forget any details.
If you’ve got entire days off during the week that you’d be open to spending in a classroom with students, you can become a part-time substitute teacher (which will be hugely appreciated by the teachers you’re helping out). The process for becoming a sub varies by state, but in California, it’s surprisingly easy (and also how Jeremy began his career as a teacher!). You’ll need to look up how it works in your state.
READ THIS POST
What to Pack for South America: 32 Backpacking Essentials
Do you have a skill you can monetize? Sure you do! It could be literally anything.
Get creative: you can make money doing everything from tarot readings to drawing pictures or writing silly songs on Fiverr.
You can find freelance gigs for freelance writing, translation, editing, or design work on Upwork. You can even find work as a Virtual Assistant doing administrative tasks for small business owners. As a blogger, I rely heavily on Virtual Assistants to help me with a wide range of tasks!
You can find a wide variety of remote gigs on FlexJobs.com, which you can do from anywhere – perfect for long-term travel.
You can … *ahem* showcase your assets on OnlyFans. OnlyFans can be a great way to become a paid content creator – whatever content you choose to create!
The good news? Since your work will be totally online, you’ll also be able to continue your side hustle as you travel, which is especially helpful if you’ll be traveling long-term.
- Share your stuff (or space)!
There are so many ways to make money renting out stuff or space!
You can list your car on GetAround.com, for folks who need a ride for a few hours. We typically rent GetAround trucks or vans when we need to pick up Craigslist furniture finds or move. If you’ve got an RV, list it on RVShare.
You can rent out your garage for parking or storage on Stache or Neighbor.
If you live somewhere a little more rural or you’ve got some land, you might be able to rent out a campsite in your backyard on Airbnb, HipCamp, or Tentrr. You can provide as little as an empty lot, or string a few lights, roll a few stumps in, and build a little firepit to make things cozier and land more visitors. (Just be sure to check your local laws first, to confirm you’re allowed – and to get an idea of how difficult and expensive the process will be to acquire the right permits.)
You can also rent out just about everything else in your home: let people use your backyard, office, extra bedroom, home gym, pool, music room, kitchen, or anything else you can imagine on PeerSpace. This is a great option even if you don’t own your home, although you’ll need to confirm that you aren’t breaking your lease.
Takeaway: There are lots of ways to earn extra money for travel that are flexible enough to work around your schedule. Consider monetizing your skills, becoming a mystery shopper, taking advantage of the gig economy, or renting out your space or stuff.
Credit Card Points & Miles
This can be one of the most profitable ways to earn extra cash for travel, but it can also be the riskiest. Before I dive in, please imagine the word DISCLAIMER flashing over your head in bright, neon lights: do not try to play the points and miles game if you sometimes need to carry a credit card balance!
Credit cards can be a slippery slope into expensive, high-interest debt which can take years to dig yourself out of – and that’s exactly what big banks and lenders count on when they offer free money in the hopes that you’ll sign up for their cards.
So if you’re still working on paying off your credit card debt, please pass this section right on by (and come back in a few years! I’ll be here).
Another caveat is that you’ll need a fairly high credit score, in the high 600’s or better. Below that, you’ll have trouble qualifying for cards with the highest rewards. It’s better to focus on building up your credit score, and then come on back when you’re ready.
- Credit Score Tips: After years of working on pulling Jeremy’s credit score up from below 400 (yes, really) to the high 700’s, we have a few tips. First, pull one of the three free credit reports you’re entitled to each year from TransUnion, Equifax, or Experian (or use CreditKarma, a helpful tool that estimates your score without needing to actually pull your report), and dispute every single negative claim. Some might fall off and disappear, and some might be negotiable – either way, disputing them begins the process. Next, apply for a secured credit card with a low balance to start building back up your credit. Set up autopay, and buy a pack of gum with it every so often. Those cards are designed for folks with no or low credit, and they’re a great starting point for working on your credit score! You’ll be on your way to improving your scores in no time.
If you’re at a point where you won’t need to carry a balance on your credit cards and your credit score is in a good place, you can start to experiment with credit card churning and travel hacking. Essentially, you’ll be signing up for and using credit cards specifically to earn points, miles, and sign-up bonuses.
Sign-up bonuses for credit cards are my personal favorite: they’re often worth hundreds of dollars or the value of an international flight. In order to get the sign-up bonus, there will be a required minimum spend amount, often something like $3,000 in three months.
I’m usually able to hit the sign-up bonus requirement just by doing all of my spending on a single credit card for the duration of the sign-up bonus period, and I also plan ahead to sign up for a new card when I know I have a big expense coming up – say, a pricey plane ticket, or holiday shopping.
In order to maximize sign-up bonuses, I space out new card sign-ups to avoid doubling up and missing out on a sign-up reward; and I typically only open one new card at a time.
You’ll need to do some research to figure out which credit cards make the most sense for you. I focused on cards that I could use for the trip: cashback rewards on categories I spent the most in (like restaurants, travel, and groceries), points that could be exchanged for travel, and miles for airlines that I was likely to fly during my trip.
My favorite credit cards for travel are travel rewards cards, like my Chase Sapphire card. It’s been my favorite travel card over the years, not only because I earn points on my many travel purchases, but also because of its excellent travel insurance policies: they saved my butt when we ran our BMW into a castle in France, reimbursed a canceled trip due to labor strikes (also in France… weird coincidence), and have generally saved us many times over the years.
Plus, we get access to airport lounges, which is my favorite way to break up a series of long-haul flights (I wrote this post from a lounge in Lisbon on a 48-hour haul between NYC and Rome). And there are no foreign transaction fees, so I can use it while traveling without racking up extra charges.
I’ve also signed up for specific airline cards to help me pay for plane tickets, like Southwest and Hawaiian Airlines. These usually come with a chunky sign-up bonus, and are fantastic for airlines that depart from your home airport or that you fly frequently.
Airline miles are also usually transferable between airline “partners,” so for instance, American Airlines miles can help you pay for an inexpensive short-haul flight during your trip on Japan Airlines, Fiji Airways, or SriLankan Airlines.
I also love my American Express Blue Cash Preferred card, which pays 6% back on groceries, and my Capital One Venture card, which gives me 2x points back on everything.
It can all be very confusing, so I recommend seeking out the advice of experts. My favorite resources are the Churning Subreddit, and The Points Guy blog, CardRatings, and NerdWallet.
I highly recommend starting a spreadsheet to keep track of everything (because, of course I do) so that you don’t miss things like how much you need to spend on each card and by what date in order to hit the required minimum, or the date of your one-year card anniversary, which will incur a high annual fee.
Although a few of my favorite cards do have annual fees which more than pay for themselves in rewards, when I sign up for a credit card just for the sign-up bonus, I usually don’t want to pay an annual fee or keep the card open. In those cases, I either call the card issuer to ask nicely if they’ll wave the annual fee, or I just cancel the card outright.
Personally, I opened about 20 cards over the course of five years, whose rewards paid for thousands of dollars worth of travel expenses before and during my trip. It took quite a bit of finagling, but the time I spent definitely paid for itself; and to my surprise, credit card churning even increased my credit score!
- Very Important: To make travel hacking worthwhile, you’ll need to set everything up on autopay so you don’t unintentionally pay any interest, and be very careful never to spend money you wouldn’t have otherwise just to earn more points.
Takeaway: If you have a high credit score, credit cards with travel perks & sign-up bonuses can be a great way to earn extra money for travel. But be careful not to carry a balance or overspend!
READ THIS POST
How to Plan an Amazing Lake Tahoe Winter Trip (on a Budget)
Travel Scholarships & Stipends
There are a several travel stipends and scholarships that can help you fund your travels:
- Hostelling International USA annually awards travel stipends of up to $2,000 to young Americans under 30. Check out whether you are eligible for a travel stipend and learn how to apply right here.
- If you are an aspiring travel photographer, filmmaker or writer, then check out World Nomads’ travel scholarships for creatives. Scholarships include travel costs and the opportunity to work with and be mentored by a professional creative on a real-world project for a client. Past scholarship winners have created successful travel blogs, published photos in major publications, and gone on to work in film production.
- International Volunteer HQ (IVHQ) offers four Volunteer Abroad Scholarships every year that include a sponsored two-week volunteer program, a $1,000 travel voucher, and travel insurance. Learn more & find out how to apply.
- Gabby, the amazing travel blogger behind PacksLight.com, maintains a curated list of travel scholarships, fellowships, and other travel opportunities – find it here. Make it a habit to check her site regularly to jump on new opportunities!
READ THIS POST
21 Travel Safety Tips: How to Protect Yourself and Prevent Theft while Traveling
How We Saved $30,000 for a Year-Long Trip
Now that we’ve got some context, let me tell you about the five years I spent saving up for my year-long trip, beginning the same year I graduated from college and started my first grown-up, salaried job (and a couple of years before I met Jeremy).
My initial savings target for my year-long trip was $15,000: enough for 12 months of budget backpacker travel in South America or Southeast Asia, plus a little extra cushion. If I was able to sock away $500 per month, I could save that amount up in 3 years – not bad at all!
I had a salary of $50,000 per year and no student loan payments. In order to cut my expenses, I moved into the tiniest apartment I could find to save money on rent (which cost $1,250/month), brought my own lunch to work each day, made up my own boring coffee each morning and drove as little as possible. And, since I was 22, I continued a hallowed college tradition of pre-gaming before a night out and sneaking my own flask into bars. You know, to save money.
I also ran a few side hustles to earn extra cash, like mystery shopping (which is, weirdly, a lot of fun), running an online handmade jewelry business (truth be told, it was more fun than profitable), and credit card churning (which I highly recommend to anyone with a lot of free time, an affinity for spreadsheets, and a high credit score – more on that below).
But when I met Jeremy, things changed. For starters, my trip savings target had to double to $30,000 to account for the dead weight (I’m kidding of course; if anyone’s the dead weight in our relationship these days, it’s our dog, Mulan).
And though I didn’t know it yet, Jeremy’s financial situation was also very different from mine. For one thing, he kept getting shady calls at all hours of the day that he refused to answer. When I finally worked up the courage to ask him why, he told me they were debt collectors. (I’m not sure whether that was a relief or not).
A few months into our relationship, we were getting ready to move in together — and I started to piece some things together. My handsome, charming new boyfriend was a part-time barista with a degree from a for-profit art school, and yet, every time he took me out, he insisted on paying. It was incredibly sweet, but it didn’t really make financial sense.
And if we were going to get serious about things (and share my extremely small apartment), we needed to be honest with each other about everything. I needed to know the most intimate detail about him: his credit score.
Let me be honest when I say: I did not know that credit scores could go that low.
But we were saving up for a year-long trip around the world, and I needed his help. We had a lot of work to do!
READ THIS POST
Las Vegas on a Budget: A Massive Local’s Guide to Sin City on the Cheap
Jeremy got started right away, going through every negative mark on his credit score – because improving his credit score would mean we could snag better credit card deals, which would help us pay for our trip (more on that below). He called each and every debt collector to contest, renegotiate, or pay down his debt, including setting up income-based repayment for his sizeable student loan debt. He set up a budget and stuck to it.
He also quit his job at the coffee shop to pick up better paying part-time work as a substitute teacher, a job he found himself enjoying immensely and which soon became his career.
Meanwhile, I opened up as many credit cards as I could, and added him as an authorized user so we could rack up more points with our combined spending and raise his credit score at the same time.
Moving in together also meant we could split our variable costs and save more money. To save money on food, our biggest expense after rent, Jeremy worked on improving his cooking skills. We replaced nights on the town and expensive dates with hiking, camping, picnics in the park, or riding bikes together. We were making great progress!
And then, in a weird twist of fate and luck, just six months into dating, Jeremy totaled my car on a camping trip while driving on a windy mountain pass in the high Sierra Nevadas. I’d love to say it was a freak accident that nobody could have seen coming, but it was entirely avoidable: he ran over a giant rock which tore the oil pan out from underneath my car, and then continued driving as alarm lights lit up on the dash until the car just gave up and died. It was only the beginning of a car curse that haunts us to this day. (You can read the full story in one of my first ever blog posts.)
To my complete shock, I wasn’t even mad. I was just glad we were okay. And even more surprisingly, I found the whole thing pretty amusing.
It was in that moment that I realized we were destined to be together: I would have murdered anyone but my true soulmate.
Even though we did receive some insurance money to cover the loss of my car, we decided to go car-free for the next few years, which ended up being a fantastic way to boost our savings since we were suddenly forced to walk, bike, and transit everywhere – which was not only great for our savings, but also better for the environment and our health, too!
And so, a few years later, we hit our savings target. Not quite on time – it took me five years to save up rather than three – but we had enough to cover a full year of travel! And thanks to the insurance money from our poor totaled car (RIP), we even managed to scrounge together a few thousand extra to pay for a beautiful, intimate wedding in the Berkeley redwoods.
Of course, my savings target ended up being too low because halfway through our trip, we switched gears and left South America to travel through much pricier Western Europe and the USA, and ended up spending quite a bit more than what I’d budgeted for – but that’s a story for another post. (Read the full story of our year-long honeymoon here.) But hey, we did a great job sticking to my budget estimations while we were actually following my original itinerary!
Today, years after returning from our round-the-world adventure, my wonderful husband not only has a near-perfect credit score, but he even teaches budgeting and personal finance as part of his 12th grade Life Skills class. In fact, I ripped off one of his lesson plans to write the budgeting section of this post. So, technically, this was Jeremy’s guide to creating a budget! (Oh, and he’s an excellent cook).
Plus, by working together with our improved financial skills, we were able to replenish our savings (which were all but wiped out after our trip) within a few years of returning back home.
And now, 9k words later (phew!) it’s time for you to start saving for your dream trip. It might take a while — maybe a few months or even a few years — but you can do it. I know you can! You’ve got this.
Now that you’ve put a plan in place to reduce your expenses and increase your income, you can start putting aside money into your Travel Fund.
I recommend setting up an automated system to deposit money regularly from your checking account into a savings account to keep yourself honest. I’m a big fan of SmartyPig, which lets you set up a savings account with an automatic deposit calculated to help you hit your savings goals. You can even name it something like Travel Fund, which is weirdly super motivating!
If you typically get paid in cash, create a physical place to deposit a set amount of your earnings each week or each month, and hold yourself accountable. Yes: I’m talking about a piggy bank. (For a slightly more grown-up version, I love using a good jar, or a shoebox with a hole cut in the top).
Also, and this is especially important if you’ll be saving up money for a very long time: don’t forget to treat yourself! You’re working hard to save money, and it’s okay to enjoy the fruits of your labor from time to time.
And hey: if you’re feeling ready to take the leap and travel long-term, I wrote a best-selling book called How to Quit Your Job & Travel! In it, you’ll find absolutely everything you need to plan, prepare for, and embark on a once-in-a-lifetime adventure. In fact, this post was adapted from a chapter in the book! Take a look, or learn more about long-term travel by reading the story of our year-long honeymoon or the things nobody tells you about long-term travel.
Takeaway: It took us a long time, a lot of compromises, and some old-fashioned teamwork to save up for our year-long honeymoon. We saved $30,000 in five years – enough to quit our jobs and travel for a year! (If you want to learn more, check out my book: How to Quit Your Job & Travel.)
READ THIS POST
What to Pack for Disney (& What NOT to): Ultimate Disney Packing List by a Former Cast Member
Ready to buckle down and start saving and planning for your dream vacation? Did this post help or inspire you? Drop us a comment below!
Looking for more practical travel tips? Take a look at some of our other posts:
Get the FREE Travel Planning Guide
Need some help planning your next adventure? Our FREE 25-page Travel Planning Guide includes everything you need to plan a trip, plus 5 printable packing lists. We’ll also send our favorite travel tips straight to your inbox!