Last Updated: 4/5/2021 | April 5th, 2021
Get out a sheet of paper and write down all your set expenses: rent/mortgage, automobile payments, cable/streaming bill, cell phone, insurance, school payments, etc. Tally them up.
Then write down all your discretionary spending. This is what you spend on food, film nights, drinks, shopping, that daily coffee from Starbucks, cigarettes, sports tickets, your daily midday snack, and other similar things. If you don’t know what you spend money on, go track your expenses for a two-week period, see what you spend, and come back.
Add that all up — what did you get? probably a large sum of money.
And I bet there will be numerous expenses you didn’t realize were there. financial experts call these “phantom expenses” — we never know they are there because the expenses are so small. people bleed money without realizing it. A dollar here and a dollar there adds up. even a daily bottle of water or candy bar can make a substantial difference over the course of a year.
What does this have to finish with travel?
One of the main reasons why you think you can’t travel the world is money. “I can’t afford it,” people say to me, “I have too numerous expenses.” many of us certainly have expenses we can’t cut (though remember when you travel the world long-term, numerous of those expenses disappear), but if we cut our phantom expenses, decrease our set costs, and find other ways to save we can build our travel fund much much more quickly.
In short, if you want to start traveling much more or save up for a particular trip, you need to create a budget. This will let you see where you can make cuts and where every penny you earn is being spent.
Cutting your daily expenses, being much more frugal, and downgrading to a simpler way of living will allow you to save money for your trip around the world without having to find extra sources of income. I know these suggestions work because I used them before my first round-the-world trip (and still use them to keep my living expenses low).
Of course, the lower your income, the longer it will take to save enough to travel. but longer doe not imply never. A little bit each day adds up to a lot over a long period of time.
Here are some easy and creative ways to cut your expenses, make money, and get on the road sooner:
1. Track your spending
As discussed in the introduction, many people don’t have a budget so the first thing you need to do to save money is to know where you’re spending it. In an age where you tap an app and a automobile comes, it’s easy to not think about how much we spend. create a spreadsheet or use a service like Mint and track all your expenses. You’ll probably be amazed at where your money goes once you start paying attention. I live in Austin and I found myself realizing I was spending close to $100 USD a month on escooter rides. The distances I take them aren’t that far and, because the weather is typically nice, I chose to start walking more. It’s healthier and cheaper. That’s a $1,200 a year savings (i.e. a few months in Southeast Asia!)
Start tracking your expenses – and keep doing so – so you can keep cutting out the low hanging fruit and find where you’re spending money. You can use a spreadsheet or site like Mint or Onomy to do so.
2. set up a separate bank account
Financial experts have long recommended this. set up a separate bank account and have money automatically deposited into that account each pay cycle. No matter how much you put away there, putting that money in a separate bank account implies it’s away from your spending and you won’t overspend. think of this like a piggy bank. Don’t rob it. It’s your travel fund.
3. cut the coffee
Love your Starbucks? Well, Starbucks loves your money. Coffee is a daily expense that quietly drains your bank account without you even noticing. That daily $5 USD coffee costs you $150 USD per month. At $1,800 USD per year, that’s two months in Southeast Asia.
What’s much more important: your daily cup of Joe or spending much more time on the beaches of Thailand or exploring the jungles of Borneo?
Sure, giving up your cup of coffee seems like a “duh” thing. And, yes, there is utility in the time saved from purchasing one. Under normal circumstances, this would be “small thinking” financial guidance that isn’t worth the time or effort.
But, best now, you have a travel goal to reach and every penny counts.
4. learn to cook
We all need to eat but restaurants are expensive. To keep your food bill low, cook much more often. I learned to cook while in college (a skill that has helped me ever since) and before I left for my first trip, I cut down my eating out to two times per week. Every other meal I cooked myself. I would save the leftovers from dinner for lunch the next day, thus saving much more money.
You don’t need to be a whiz in the kitchen, either. There are a million and one cooking sites, YouTube videos, and recipe blogs that will instruct you how to cook fast and healthy meals. I never spend much more than 20-30 minutes making a meal.
Here are some sites to check out to get the ball rolling:
Food52
Deliciously Ella
Bon Appétit
Jessica in the Kitchen
5. lose the car
Between insurance, repairs, loan payments, and filling your tank with gas, automobiles are crazy expensive to own. get rid of your automobile if you can. learn to love the bus, take the subway, bike, or walk. It may take longer to get to work using public transportation, but you can use that time to plan your trip, read, write, or do other productive tasks.
I understand that this suggestion may not be possible for everyone, especially those in smaller towns that don’t have an comprehensive public transportation system, but an alternative is to sell your automobile and purchase a less expensive used one, which you will only need until you leave for your trip. purchasing a throwaway automobile will allow you to pocket the money from your much more expensive automobile and put it toward your travels.
Additionally, with the proliferation of Uber, Lyft, and other ride-sharing services, it’s never been easier, even in small towns, to find transportation. Do the math on it but it may be less expensive to get Lyfts around town than to own a car. (Plus, if you need a automobile for long distances, you can easily rent one.)
6. save on Gas
Gas adds up! Luckily, there’s plenty of ways to save on gas! First, use the app GasBuddy to find low-cost gas near you. Second, sign up for all the major gas station loyalty programs. By default, they save you around 5 cents per gallon. Shell’s fuel rewards is the best because you attached it to a dining program leading to savings up to 50 cents a gallon. Moreover, use GasBuddy’s credit report card, which can be tied to any of these loyalty programs and then used for an additional savings of 25 cents per gallon. many supermarkets also have loyalty programs that offer gas savings. And, if you sign up for Costco, they have substantial savings too.
7. Stream!
In the age of Hulu and totally free (and legal) streaming TV, there’s no reason for you to be spending $50 USD per month on cable television television. get rid of it and just view everything online for free. You can also start sharing your streaming costs with pals or family. conventional Netflix is $12.99 USD per month. If you can cut that in half by splitting it with a friend, you’ll save a few bucks.
8. Downgrade your phone
The average American phone bill is over $100 USD per month. While smartphones are useful devices, getting a low-cost phone without any fancy apps will cut your monthly phone bill in half (if not more). You might get bored on the train not being able to read the news, but saving an extra $600-800 USD a year will allow you to spend a few much more weeks in Europe, purchase fancier meals, or learn to scuba dive in Fiji.
Consider purchasing a easy flip phone or even a refurbished phone. You’ll waste less time online and save money. double win!
9. get a new credit report card
A travel credit report card can give you totally free money, totally free rooms, and totally free flights. After accruing miles and rewards points with your card on everyday purchases, you can redeem them for totally free travel on your trip. travel credit report cards are a big weapon in a budget traveler’s arsenal. You’ll even earn substantial sign-up bonuses when you get a new card.
When used properly, these cards generate totally free money so start early. As soon as you decide to travel the world, get a travel-related credit report card and begin earning points on your daily purchases. A few credit report cards worth checking out are:
Chase Sapphire Reserve – the best card on the market, providing 3x points on restaurants and travel, lounge access, and over $300 in travel credit.
Chase Sapphire preferred – A much more affordable version of the Reserve with 2x points on restaurants and travel as well as no foreign tranaction fees.
Capital One venture – An easy-to-use card with a $100 credit report for global entry over 10 airline partners you can tranfers points to.
Chase freedom limitless – A easy cash-back card with 5% cash-back on travel.
For much more credit report card suggestions, check out this list of the best travel credit report cards.
And, for much more information on travel credit report cards in general, here is my extensive guide on how to pick a good travel credit report card.
10. open an online savings account
While saving, you can have your money grow a little bit much more by putting it in a high-yield online savings account. I’ve done this because the time when I was preparing to go away on my first trip and I netted a few extra hundred dollars. interest rates are pretty low these days but you can still get 0.50-0.80%. good online us banks include:
Salem five direct (0.80%)
Citibank (0.70%)
CIBC bank (0.70%)
Discover bank (0.60%)
Not from the US? check out these sites for much more local information:
Canada
UK
Australia
New Zealand
11. get a Charles Schwab account
Charles Schwab bank refunds all your ATM fees and has no account fees. With this card, you’ll never pay an ATM fee again. When you think about how typically you take out money — both at home and abroad — this is a game changer. For much more on saving money when you bank, read this article.
Note: This is only available to Americans.
12. sign up for travel newsletters
No one likes to clutter up their inbox, but by signing up for mailing lists from airlines and travel companies, you’ll be able to get updates about all the last-minute sales or special deals happening. I would have missed out on a round-trip ticket to Japan for $700 USD (normally $1,500) if it wasn’t for the American Airlines mailing list.
Additionally, consider signing up for a site like Scott’s low-cost Flights. They hunt down deals and send them directly to your inbox — for free! They also offer a premium service that provides much more (and better) deals but at the very least join their totally free newsletter. chances are you’ll find some amazing deals!
13. build a network on Couchsurfing
Building a network on Couchsurfing can help you make pals with locals and get totally free accommodation when you do travel.
However, if you’ve never used it before you might not get numerous responses. After all, someone who hasn’t been vouched for and has no reviews isn’t an appealing candidate. before you go away, sign up for Couchsurfing, find a local meetup (there ought to always be at least one in your area), and attend. You’ll make friends, be added to people’s profiles and vouched for, and have a network you can utilize when it is time to actually go away.
Of course, if you have space in your house you can also host travelers before you depart (or just meet up with them for coffee). This is the best way to build your network, get familiar with the platform, and earn reviews that will help you down the road when you’re searching for a host.
If possible, verify your account as well. having a verified account will increase the chances of a host accepting your request.
14. replace your light bulbs
Electricity costs money and because every penny counts, using energy-efficient light bulbs will cut down on your utility bills. Fluorescent light bulbs are low-cost and replacing just five bulbs can cut $75 USD per year off your electric bill.
Moreover, due to energy efficiency initiatives in certain states, numerous electric companies will give you a rebate if you purchase fluorescent bulbs! Be sure to check out which rebates your local energy company provides no matter where you live in the world.
Going green can save you green!
For us readers, check out EnergyStar or the DSIRE database. For Canadian readers, check out this page run by the government. For everyone else, check your local government or utility company’s site for information!
15. purchase second-hand
Why pay full price when you can pay half? use sites like Amazon (discounted books and electronics), wholesale websites, Facebook Marketplace, and Craigslist. towns big and small typically have thrift stores like goodwill where you can pick up clothing and odds and ends. Sure, you don’t want to purchase everything used, but you can certainly purchase many things used!
Plus, it’s good for the environment because you’re giving stuff an added use life rather than having it end up in a landfill!
16. cut coupons
The home entertainment Book, grocery coupons, Groupon, and loyalty cards all decrease the price you pay at the register. Clipping discount coupons might make you feel like an 80-year-old grandmother, but the goal here is to be prudent and save money, and discount coupons certainly help with that.
Many grocery stores also offer electronic discount coupons based on your shopping habits. sign up at your local grocery store for their loyalty program and you can lower your weekly grocery bill with discounts either sent through email or added directly to your loyalty card. here are some discount and discount coupon sites worth checking out are:
Honey
Swagbucks
Don’t Pay Full
RetailMeNot
Additionally, check out Mr. Rebates and Rakuten, which give you ca
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