You Can Save More Money While Traveling Than You're Saving Now — Here's How

Mar 26, 2018 at 5:00 p.m. ET
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By Annamarie Houlis

There’s a wealth of resources out there about how to save money to travel, but there are few resources about saving money while traveling. Contrary to popular belief, you can travel without blowing through your bank account — and even save more money while doing it.

I know that to be true because I’m currently backpacking Southeast Asia, putting away money that I’d otherwise be spending on rent and the everyday costs of living. Here are my secrets to building instead of breaking the bank while traveling the world.

1. Hostel-hop

Hostels in most parts of the world are going to be cheaper than the cost of your rent — even if you stay in hostels every night for a month. You can opt for a private room, so it’ll feel like a hotel without the price tag of one, or opt for a dorm, which is usually cheaper but you get what you pay for. There are usually free tours and breakfast offered to guests as well, so you’ll save some money there. And some offer free ground transportation to and from airports too.

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2. Think: Food is fuel

On average, Americans spend about $53 per week getting lunch, according to a survey of 2,033 people by Visa taken in July and August. You can spend a fraction of that on the road when you think of food as fuel. Sure, traveling is largely about the food in new places, but be mindful about what it is that you're eating. Eat cheaper street food or actually buy groceries like you would at home, and then save for one bigger, nicer dinner or lunch a day so you can enjoy that part of the travel experience. In most Southeast Asian countries and a lot of South American countries, for example, you can eat meals out for under $5 USD. In Thailand, you could eat out for breakfast, lunch and dinner every day of the week for an average cost of just over $30.

3. Use multiple modes of transportation

When you're home, chances are you're spending a chunk of your change on gas or public transportation to commute to and from work. When you're traveling, you'll still be spending money on transportation, but rather than having a monthly expense, you can save money by finding the cheapest routes from point A to point B. Flying from Switzerland to Italy might be quick, but options like the Eurail are much more cost-effective. A global pass will allow you access to trains in 28 European countries for up to three months of continuous travel for as little as $351 USD. That's a fraction of the cost of one flight, and it's about the same cost of the a subway pass for three months in New York City — except you'll have access to 28 countries across Europe and not just the five boroughs.

You can also save money by taking ferries and sleeper buses, which are ideal for long trips since some offer beds — and you'll cut costs on accommodation for a night too.

Rome2Rio is a resourceful app that helps users find the best (and most cost-effective) alternate routes from one place to another via any form of transportation.

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4. Be wise about where & how you exchange your money

While the U.S. dollar won't get you quite as much as it did in certain spots around the world even just six months ago, there are still a bunch of places where the exchange rate will be your friend — most of Asia and South America, plus places like New Zealand, Norway and more. This means the cost of living for an American traveling could be significantly cheaper than the cost of living at home.

Just be mindful about exchanging your money. Typically, the first currency exchange booth you’ll find is the one in the airport. While it may feel like a good idea to go change your dollars before heading out, airport exchange booths will often offer the worst rates — that’s because they know that virtually everyone there needs to exchange their money for the local currency. Sometimes, you’ll need to exchange your money there, as you’ll need cash to pay a taxi or for a train ticket to get you to where you’re staying. But if you can pay on a credit card, do it and look for an exchange booth once you’re in the city.

Also, if you’re traveling to multiple destinations, take out only as much cash as you think you’ll need. For one, you don’t want to be wandering around with a wad of cash on you. And for two, changing your money from one currency to the next to the next and so on might lose you money in the long run. That's because sometimes currency values change and booths can charge fees for exchanging your money.

5. Use credit cards intended for travel

At home, we're not spending quite as much money on hotels, hostels, transportation and eating out — it's just because we've got our own places to stay, sometimes our own cars and our own kitchens. But spending money on that stuff while traveling could actually earn you money too — if you use a credit card intended for travel, that is.

I have the Capital One Venture Rewards card, through which I have obtained 40,000 bonus miles after spending $3,000 in the first three months. I get 2 points for every dollar spent on travel (cabs, ride shares, subway tickets, flights, hotels, etc.), and that equates to a rewards rate of 2 percent if I choose to redeem for flight miles. I can also use those points to purchase gift cards for hotels and restaurants, or I can redeem them for cash. It's how I purchased my flight from New York City to Bangkok, Thailand for just $7.

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Plus, with a credit card that doesn’t charge you a fee for foreign transactions, you can rest assured you won't find any random dollar amounts on your statement at the end of the month. Other noteworthy travel cards include the Chase Sapphire Preferred card, the Barclaycard Arrival Plus World Elite MasterCard or the Capital One VentureOne Rewards card.

Originally published onFairygodboss.

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