9. Be penny wise
When going backpacking you have 3 choices for finances:
- Either you go with a fixed budget – money you earned before the trip – and when it runs out you go home.
- You can also go with money and plan on working during your travels – a working holiday visa is recommended, read more about that in the post Working Holiday Visas – this may allow you to stay away for longer than the fixed budget.
- Your third option is to leave with money constantly coming in during your trip. There are a few ways of making that happen. You can either have a remote work deal, meaning you will have to work during your trip over the internet most likely, or you can be a remote student getting student grant while studying in a far cheaper country than your home country has many benefits, while stretching your money further it also brings more money into the local economy of a poorer country and funnels it out of a richer one. Think of yourself as Robin Hood. There are of course other ways of having money keep on rolling in while you’re travelling, like retirement or royalties for example. But I’m going to assume you’re a regular Joe like me.
Whichever of these categories you belong to you will obviously need to adjust your budget thereafter. I don’t need to tell you how to budget, if you’ve been able to save up for a big trip you already know how to budget. But keep a few things in mind:
- Spending $50 on an attraction will most likely be a better memory than spending $50 on a night out. In many countries $50 worth of food and alcohol would be enough to knock out a horse, how then were you going to remember the new “friends” you made when the booze was flowing? I’ve seen plenty of backpackers spend a few months simply partying their money away with other backpackers at night, while their days were spent hungover in bed just to venture out of the cave for an afternoon meal. Minimal interactions with locals and never any money to spend on attractions or spontaneous trips anywhere.
- The highest value of accommodation is not it’s price, but it’s location in the city. A centrally located hostel/hotel in a safe area is worth 10 times as much as a cheaper hotel on the outskirts of the city. This means less time spent travelling to the city, you will get more time to explore, less money spent on transportation and more excitement around you. Of course the best is always if you have a friend in the city and you can stay on their couch or maybe even an extra bed. That is, however, a luxury you can’t depend on for every city you go to.
- Be smart with your meals. Don’t eat restaurant food every meal you have, as that is a sure fire way to have your expenditures run wild, save that for your lunch to replenish your energy stores for the rest of the day. Lunch is quite often cheaper than dinner as well and you don’t really need a lot of energy at the end of the day anyway. Many people who gain weight while travelling do so because they simply indulge too much, so keep that other benefit of staying fit in mind. Eat lots of fruits for snacks and find alternative ways of meeting your daily calorie needs.
- Look at alternative routes and days for travelling in and out of places. It might be half the price to travel one day later, or earlier, and by having a stop over somewhere for a couple of days your flights might end up being cheaper. Don’t see the days you will be spending in the extra location as a higher cost for the flight as they are costs of living, not transportation. You will be enjoying yourself in another location, it’s just more travels.
- Again, research is key. Know the location you’re going to and it’s festival times. Unless it’s something you want to see it might be a better idea to stay away as cost of accommodation goes up during national holidays and big events and even restaurants may increase their prices during that time. Do your homework and you will be fine.