7 Key Budgeting Tips for Your Next Vacation

All you need to know.

August 25, 2023

With 2023 already halfway over, those who haven’t yet taken a vacation should waste no time in getting one on the calendar. Unfortunately, prices have risen drastically in recent years to the point where even a short vacation risks breaking the bank for some people. Now, more than ever, learning how to build a budget and save money for a vacation is crucial. To that end, there are seven main tips any person can use to successfully plan an affordable vacation in the coming months.


How Expensive is the Average Vacation?

It’s one thing to say that vacations have become expensive in recent years but it’s another to look at the numbers. Currently, it’s estimated that a one-week vacation in the United States costs a person just over $1,500. Two people going on a vacation causes that price to jump up to $3,200 on average. A person may think that they might as well take an international vacation at that point, but they’d surely be disappointed to know that $4,000 is the average cost of a two-week European vacation.

7 Tips for Building a Vacation Budget

Given the incredibly high prices for vacations in the modern day, learning how to save as much money as possible should always be a top priority. The best way to go about this is to build an effective vacation budget that takes your current finances, goals, and ideal itinerary into account. Below are seven primary pieces of advice a person can use to start building out that budget:

1. Be smart with your accommodations

First and foremost, most people automatically assume they will need to stay in a hotel when they go on vacation, but hotels are quite pricey. In fact, the average nightly hotel cost in America is now over $150, which may be a tough price point for some people. To save money in your budget, consider looking into vacation rentals instead, which are short-term rentals that provide a person with an entire home, rather than just a room.

2. Book flights with plenty of time to spare

Any person who is trying to build out a vacation budget should secure the largest costs right away at the cheapest value so that they can start to build out smaller estimated costs into their budget. In particular, aim to book your flights as far in advance if possible and try to book days that are not quite as popular for travel.

3. Consider using credit card rewards points when possible

Building off of the above points, another way to free up some room in your budget as you begin to build it out is to use credit card reward points for bookings instead. For those of you who use credit cards, you have likely accrued points over time in a credit card rewards portal. Try logging in and going to your rewards portal to see who the partner airlines or hotel chains for your credit card company are, so that you can transfer points for your purchase instead of using cash.

4. Turn to public transportation instead of rideshares

One of the biggest categories in anyone’s vacation budget is transportation costs, but not those associated with flights. Getting around once you touch ground in your destination will result in other transportation costs but rideshares are the typical go-to for many travelers. Building a budget around this unpredictable cost can be difficult, though, so consider researching public transportation in the area instead. This will give you a fixed cost that you can work into your budget for the trip.

5. Toss around the idea of cooking your own food to save on costs

While visiting famous cities such as New York City, San Francisco, or Dallas provide a person with unique culinary experiences, they aren’t friendly on the budget. Instead, consider researching food costs at your destination and making the decision to cook your meals, rather than eat out, in order to free up room in your budget.

6. Come up with a plan for activities on the trip

No budget is complete without an idea for the day-to-day activities that will be embarked on by a traveler. Therefore, to flesh out your budget further, research what you actually want to do when you reach your destination. As a bonus, consider booking these activities in advance so that the price is locked in and so that it can be added into your budget immediately.

7. Travel to the destination during its off-season

One final and simple way to start building out your vacation budget is to focus on traveling to a destination during its off season. There will be less demand in the area which means goods and services will cost less when you are there. Therefore, a budget can have a lower maximum spend amount when traveling during this time.

Quick Advice for Saving Money While in Your Destination

With all of the above tips for building a vacation budget outlined above, learning how to actually save money once you touch down in your destination is important. Here are a few quick tips that can help:

- Pay for your trip using your debit card or cash so that you don’t spend more than you have

- Don’t travel on certain days of the week that may be more expensive

- Sign up for a hotel or airline loyalty reward program while you are there

- Go on a spending freeze on your trip so that you only spend money on the necessities

The Bottom Line

While taking a vacation in 2023 may not be a viable choice for everyone, finding ways to save money for your trip can make it more possible. Use each of the above budgeting tips, along with general advice for saving money in advance, to get your trip on the calendar without breaking the bank. No vacation will come without costs, but by being strategic about your purchases you can have both an affordable and fun trip.