Budget

Putting together a budget to take a year-long sabbatical to travel is no easy task.  If you will not have a steady income while you are gone, it is important that your budget is reasonably accurate.

If you are putting together a travel budget or are simply interested to know how I did it, read the How to Put Together a Travel Budget section.

If you are interested in my current budget for a year-long journey through Latin America and comparisons with what I have actually spent, read the My Budget section and Actual Costs section.

My Budget

For details on what types of expenses are included in each category, read the Category Definitions section.  Note that this is a budget for 1 year of travel.  I am now past that year, and I changed my plans to stay longer in some places and less time in other places during my travels.

Actual Costs

Category Definitions

Getting There – Includes the cost of moving from one place to the next.  This may require border fees or tourist visas.  Moving from one destination to the next may require flight, bus, private shuttle, taxi, boat, donkey, etc.  As an example, Getting There cost of El Salvador includes private shuttle from Guatemala to Playa El Tunco, the first place I stayed, plus the cost of two buses to Juayua, the second place I stayed in the country.

Lodging – This is pretty straight-forward.  The cost of each night spent in the country.

Food & Drink – Includes groceries from supermarkets or small markets selling fruits and veggies, any meals and beverages bought at street vendors, restaurants, cafes, and bars.  Beverages include water, alcohol, and non-alcoholic drinks.
Activities – Includes guided tours, entry fees for sites or parks, concerts, nightclubs with a cover charge, or any sporting activity (e.g. renting a bicycle or kayak and scuba diving).

Other – Includes local transportation (e.g. bus, metro, taxis), laundry service, communication (e.g. internet, printing, phone calls), supplies (e.g. deodorant, clothing, sunscreen, medical).

How To Put Together a Travel Budget

Full Disclosure:  I am a project manager, so I plan things out really well.  But whatever level of planning you want to do, I still think it’s important to take these steps below, even though you may spend more or less time on each.

1. Figure out where you want to go and for how long and if anyone else will be traveling with you. Of course, you may want flexibility, but you need to at least think about approximate days in potential places.  This is especially important if the part of the world you are traveling in has large differences in average costs between different towns/ cities/ countries.  Also, the actual traveling between destinations part is what quickly adds to your expenses, so you’ll want to have an idea of how often you plan to move.
2. Figure out what your travel style is. It is also important to know the travel style of anyone else you are traveling with.  You will have to meet somewhere in the middle, and this could mean you spend more money.  Ask yourself these questions:
   - Will you always opt for the cheapest accommodations, or do you have minimum requirements a place must meet?  Are you comfortable in a dorm, or will you need a private room?
   - Are you committed to cooking cheap food for all meals, or are you planning to indulge a few times a week or perhaps once a day
   - Do you plan to take a lot of guided tours, or are you going to find your own way?
   - How much alcohol do you plan to drink? How often do you plan to go out to bars/ nightclubs?
3. Identify any big-ticket activities you want to do. Some things are quite expensive, and you’ll want to plan for these bigger activities you know you want to do.  Examples include hiking Machu Picchu and scuba diving.
4. Get the most current edition of a good travel guide (preferably published within the past year) to estimate your expenses, adjusting for your answers to the questions above and adding at least 10% to account for price inflation since the guide book was researched.  I suggest estimating by city/ place, not just country because there can be drastic differences.  Remember to include cost of getting there from prior destination, lodging, food & drink, activities, local transportation, supplies, laundry service, communication (e.g. internet, cell phone minutes, public phone call shops, postage).  See Category Definitions for more details.
5. Add in a buffer for the unknown. The longer you plan to travel, the more likely it is your plan will change.  And if you are purposely putting less work into the detailed planning, add extra buffer.  I suggest anywhere from 5-15%.

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