5 Financial Tips for Traveling

Traveling the world is an exciting and enriching process. Whether it be for you to experience the cultures of others, or you want to see different parts of the world, it will cost money. If you’re like me and you have been strapped for cash while wishing to fulfill this desire, then this post may be for you!

This is not a post about being a near 0 dollar traveler. If you are looking for that, go check out https://www.worldpackers.com/articles/travel-for-free to see the resources that Ayla used to see foreign parts of the world! This post is for those that want to experience traveling in a comfortable, free way but don’t want to break the bank.

Now that we’ve gotten that out of the way, here are 5 financial tips for during your travels.

ONLY USE YOUR MONEY

When I say this, I mean it from the bottom of my heart. You must not use a credit card, line of credit or any other form of borrowing to travel! This seems so easy to rationalize. “Oh Jordan, I can pay it off within a year or two, it will be fine!” You might be right but you’re paying far more for this experience than you should be paying. Let me put it this way, I’ve been there. I’ve used a combination of student loans and credit cards to finance my first huge trip to Thailand. Although it was an amazing, magical experience for the month, I ended up paying a horror in interest over the next couple of years as a college student. Here are the raw numbers. I spent 8,250 dollars in Thailand and Cambodia for 5 glorious weeks. Don’t get me wrong, this is a massive budget; but I lived like a king for those 5 weeks. The amazing adventures, massive amounts of food and drinks and the beautiful places that I stayed at were pleasures from out of a dream. But once I woke up after those 5 weeks, I paid the debt back over the course of 3 years. Yes, $8,250 may be a small relative sum of money for you if you’re making 6 figures a year (IN WHICH CASE JUST SAVE A COUPLE OF MONTHS EARLIER FIRST!). I was a college student, making 25K a year. So after taking 3K from student loan cash and filling my credit card with the 5K remainder, I ended up paying nearly 11 THOUSAND DOLLARS! That is nearly 3 thousand dollars in interest! Just think about it, If I worked that summer and went the next summer, I could have followed up with a nice spring break in Mexico just for fun with the interest that I would have saved! Or maybe I could have used that interest saved pay part of my tuition down… My friend, please do not make the mistake that I first made while traveling; make the money BEFORE spending on a trip!

If you really feel that borrowing money to finance a trip is worth it, then check out this calculator that I built to see if it is truly worth it for yourself. I can’t tell you want to do, I can only tell you about the mistakes that cost me more than I am proud to admit.

Take Advantage of the Low Season

This solution is for someone that has the freedom to travel or someone that has a great desire to see anything new! This is not a tip for those that like to be with a bunch of other traveling strangers; i.e the party scene.

I’m not a super social guy. This usually leads to great deals for me traveling to places that have a seasonal traveling. Have you ever noticed that while day dreaming about flying across the world to Bali or Fiji that the prices are significantly higher during the colder seasons? Supply and demand my friend. In the summer, a flight across the Atlantic can be as expensive as 1,500$ if not more if you prefer a spot with leg room. Well although it doesn’t seem too charming, it only cost me 500 to get to Copenhagen from Toronto in late October. This was some serious savings! Great now the flights are covered, consider the next cost. Where you get to sleep! Check it out right now, go to a hotel booking site (No Affiliates at the moment *wink wink*) right now and check the prices for their down season! You’ll see a pretty big price gap! I have met friends around the world that have stayed in suites for as little as 20$ because the joint is already empty! I have a new neighbor that visited Vietnam during the low season and did exactly this!

If the savings are not enough of an enticement to travel during the low season, then consider this. While visiting Ireland last year, Iuliia and I had the Cliffs of Moher all to ourselves! Mind you it was about 15°C or 60°F. None the less, we had a beautiful view of the entire location! We had no issues with parking and we had an entire photo shoot without any pesky photo bombers! How much more can you ask for?!

Limit Your Luggage – Checked Bags ARE NOT Required

I know that it is very tempting to rationalize packing your entire room into your suitcase, dufflebag, backpack, purse, satchel, and clutch but you don’t need it all! Think about it this way, if you don’t bring razors, scissors, shampoo, deodorant, or any of the others things that take up a bunch of room in your check-in bag, you’re going to need to buy all of these things while you’re at your destination! That will for sure cost 30-40 USD! Yes, yes this post is about saving money, not spending it! But here’s the deal! You’re no longer spending money on checking bags into the airport! The baggage for the flight there can cost 40 USD while the flight back will also cost 40 USD! Well now… spending 30-40(High Budget) on buying personal supplies isn’t so bad is it? Also a nice little benefit is you can check-in at automated terminals and skip the whole drop-off line! Also, you don’t have to carry so much between your home and your destination!

This is one sense of preparation that, if you’re traveling the world like myself, will save you hundreds of dollars every year! Well that is unless you have a partner that insists that everything she has is critical. In which case, goodbye savings!

Insurance Insurance Insurance

This one seems pretty straight forward. You are traveling to a foreign location. If anything happens to you (God forbid) and you’re uninsured, you may rack up some serious debts! Medical service prices around the world differ drastically and it is critical to be covered while on your adventure. I am fortunate enough to say that I’ve never needed to use my medical insurance. If anything were to ever happen, I feel better knowing that I’m covered. Now in the short-term this may not directly save you money, or even at all (I hope), but if something goes wrong, your insurance will protect you from going home with a bruised ego and pocket book; despite any other bruising. Initially I purchased insurance from a family member and found it to be quite expensive for my destination. It also had some major limitations and was clearly not the right choice for me. Luckily, I never had to use it for more than a quick question about a small rash on my foot. I recommend that you do some real shopping to see what matches your requirements. I wish I could go back and purchase my current insurance; it would have saved me nearly $600 USD. Make sure to look into the coverage limit and when coverage begins to prevent any issues while traveling!

Know The Exchange

There are two special notes to make while dealing with fiats in multiple countries. first and foremost, you need to be aware of your banks rules for withdrawing money from a foreign ATM. Your bank can charge you anywhere between 5 and 15 dollars PER TRANSACTION. This really hurts the wallet when you either underestimate your spending and need to hit the ATM multiple times or you are like me and moving around long-term. Don’t worry, I have you covered for this. You can use Wise (Formerly known as TransferWise) to convert currency online and then use your debit card to take out cash. This has saved me a ton of money while moving to different parts of the world! Alternatively, if you can arrange a flat exchange rate and free foreign cash withdraws from the bank, that would be just as good!

The second part of this note is to know the exchange of the currency that you have to the desired currency BEFORE going to exchange booths. These guys are often right outside of the airport gates or in port areas. They don’t want you to know how much your dollar, euro, baht, franc, etc is worth when they offer their amounts, but similarly to every good street market, you can haggle! I personally do not want to carry around paper that isn’t worth anything in the region, but I want the best bang for my buck! Tell, don’t ask, them to do a few dollars more and be prepared to walk away if they’re not for it. I’ve been called back a few times for this and we both walk away happy.

I hope that you’ve found these 5 tips to be helpful in your future travels! It should always be a goal to make the best out of traveling but it should not break the bank!