How to Budget for Holiday Travel (2024)

Do you travel during the holiday season?

Travel at any time of year can be hectic, but it can be extremely stressful and costly during the holidays if you aren’t prepared. I am going to share how you can budget for holiday travel and save money!

No matter where you’re going, traveling during this time of year requires quite a few hacks in order to maintain your sanity.

Start Planning Early to Budget for Holiday travel

This should probably go without being said, but you don’t want to procrastinate planning for travel at all especially around the holidays.

The holiday season is hectic and there’s almost always an unexpected slowdown whether it’s at the airport, with your rental car company, traffic, etc.

Don’t wait until the last minute to decide you want to fly out and see family for Christmas and instead get stuck at the airport all night. Situations like that will only stress you out and cause you to spend more money out of convenience.

How to Budget for Holiday Travel (1)

According to the popular online travel booking company Expedia, you’ll want to plan your holiday trip at least 60 – 90 days prior in order to save around 10% on average.

Getting an early start is one of the easiest things you can do to save money on travel because it gives you enough time to properly research, explore all your options, and get organized.

Planning early will help you avoid taking small things for granted like taking the time to learn the airport and explore the transportation options from the airport.

Some airports are huge and you don’t want to miss your flight because you didn’t allow yourself enough time to check in and locate your gate.

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Budget for Holiday Travel by Shopping Around For Flights and Hotel Offers

As you get an early start on your holiday travel plans, be sure to shop around for flights and hotel offers to ensure you’re getting the most bang for your buck.

Expedia is one of my favorite sites to compare travel costs among a wide variety of competitors.

Kayak and Priceline also offer a similar service for free.

Instead of having to do all the researching yourself, let these sites do it for you.

They work out deals with major airlines and hotels to ensure you get the best discounts when you travel.

You can even take it a step further and download the Hopper app.

With this app, you can enter your desired destination and travel dates, then the app will notify you when flight prices are lower and predict price surges before they happen.

This app is great to use when you’re super busy and forget to check on flight prices so you can book your trip on time.

Finally, TripAdvisor is awesome for comparing hotel options and reading some honest reviews from other travelers so you can make sure your experience is positive.

With TripAdvisor, you can learn more about the area you’ll be visiting and find out which hotels offer complimentary breakfast and other amenities you may be looking for.

Cash In Credit Card Rewards and Other Points

If you have a rewards credit card, be sure to check your points and cash back to see if you can redeem rewards when you travel for the holidays.

If you use credit cards, odds are, you may have some reward points lying around that you can cash in on to supplement the cost of your flight, hotel stay, or other travel-related expenses.

Even if you just have a general cash back card, you can use some of your cash back earnings to pay for food, gifts, and souvenirs.

Just remember that being able to use credit cards wisely is way more important than redeeming special rewards. If you don’t keep your utilization below 30% each month, it could hurt your credit.

Plus, if you aren’t able to pay your bill off in full each month, you’ll have to pay high interest rates on your bill which could basically cancel out the benefit of any rewards you to receive.

If you’re not a credit card user, don’t worry. You can still earn rewards to cash in for holiday travel. Check out sites like Rakuten if you haven’t already.

Rakuten will help you land discounts when shopping online plus earn cash back on your online purchases.

Pack Wisely and Limit Luggage

Don’t underestimate the costs of bringing extra unnecessary luggage when you travel. Lately, when I travel I’ve been packing with a more minimalist mindset to avoid bringing a ton of stuff I never end up using.

Depending on how long your trip is, you may be able to fit all your belongings into a carry-on suitcase that you can bring on the plane with you.

This will cut out the checked back fee which could range anywhere from free to $50 depending on which airline you fly with.

If you’re driving, you probably want to pack light regardless to avoid having to keep up with a ton of luggage or possibly even buy an extra back on the way home to transport gifts, souvenirs, etc.

When it comes to your clothing, consider creating a capsule wardrobe of a few of your favorite versatile pieces so you can create multiple outfits.

Also, try packing your clothes in reusable air compression bags that will shrink the space they take up in your suitcase.

I found out about these bags and ordered some on Amazon a few years ago and they’re awesome.

I also have these three different size suitcases (they were a good deal!) so I can pack wisely based on how long I will be on vacation.

If you’re planning on bringing gifts, see if it would be cheaper to ship them ahead of time. Stop by your local post office and price out boxes, bubble wrap, and shipping labels.

If you’re bringing gifts with you when you fly, don’t wrap anything because you may need to unwrap it if security decides to inspect it. Also, avoid traveling with food items like jam, peanut butter etc. because you’ll almost always get stopped in security and the hassle often isn’t worth it.

Get a Head Start So You Can Enjoy the Holidays

Now that I’ve given you a ton of tips to help you save big on your holiday travels, the best thing you can do is get a head start and begin planning and researching early.

You’ll be much less stressed when the holidays roll around so you can actually relax, spend time with your friends and family, and enjoy your travels.

How do you budget for holiday travel?

How to Budget for Holiday Travel (2024)

FAQs

How to determine a budget for a trip? ›

Research your destination

To create a realistic budget based on your destination and activities, research transportation expenses, food and lodging costs, and prices of attractions you want to visit. Once you know the bottom line, start looking for ways to reduce expenses.

What should I budget for a holiday? ›

What goes into a travel budget?
  • Flights and transport costs. Flights are the big expense for most travellers, especially if you're heading to Europe or the USA. ...
  • Food. Ah food, one of the best parts of travelling overseas and a worthy and important part of any travel budget. ...
  • Activities. ...
  • Pre-departure expenses.

How much money should I set aside for travel? ›

Miller recommends using the 70/20/10 breakdown. This means 70 percent of your income should go toward household expenses, including debt. Twenty percent should be put into savings, including retirement. That leaves 10 percent of your income for wants, including travel, or for additional savings.

Why is it important to have a budget for travel? ›

A travel budget helps you create a realistic list of expenses, whether you're in the planning process or saving up for a potential trip. You're less likely to be caught off guard by expenses and make the most of your trip if you learn how to budget a trip ahead of time.

What is the rule of thumb for travel budget? ›

Is there a rule of thumb to employ in setting a budget for your trips? Some financial experts recommend this one: spend 5-10% of your net income on vacations. If you're in debt, your budget should be closer to the 5% mark; if you're not, it can be closer to the 10% end of the range.

How do you plan how much a trip will cost? ›

6 Factors to consider when calculating your travel costs
  • Transportation costs. Transportation expenses can quickly add up; thus, budgeting for all modes of travel is crucial. ...
  • Accommodation expenses. ...
  • Food costs. ...
  • Activities and attractions. ...
  • Miscellaneous expenses. ...
  • Additional costs.
Jun 19, 2024

How do I calculate travel expenses? ›

Look into the cost of lodging, vehicle rentals, fuel costs, flight costs, and any other expenses you may incur. Gather all of your costs together and keep them organized so you can plan for expenses and calculate your costs. You can also use a formula to figure out your fuel costs if you're driving to your destination.

How to create a holiday budget? ›

7 Holiday Budget Hacks
  1. Set a budget for each person and stick to it. ...
  2. Do your best to avoid impulse buys. ...
  3. Start shopping as early as possible. ...
  4. Shop around for the best deal. ...
  5. Opt for homemade and handmade. ...
  6. Use promotional APRs and interest-free payments for holiday purchases. ...
  7. Give the gift of experiences.
Nov 13, 2023

What is an ideal way of spending a holiday? ›

Spend time with loved ones.

The holidays are a great opportunity to have rare, cherished conversations with family members you haven't seen for a long time. For instance, you might want to visit your grandparents and have a quality talk with them.

What is the 50 30 20 rule? ›

The 50-30-20 rule recommends putting 50% of your money toward needs, 30% toward wants, and 20% toward savings.

What does Dave Ramsey say about traveling? ›

You want to ensure that your trip is the perfect amount of time so you don't spend more on accommodations than you should. It's important to note that you don't have to spend all your vacation time on your trip. You can take a few days at home or return to work earlier and bank that time off for a future excursion.

What is a reasonable travel expense? ›

What Are Reasonable Travel Expenses? Reasonable travel expenses, from the viewpoint of an employer or the IRS, would include transportation to and from the business destination, accommodation costs, and meal costs. Certainly, business supplies and equipment necessary to do the job away from home are reasonable.

What is a reasonable travel budget? ›

2) The average domestic trip costs about $144 per day while international trips come to about $271 per day. The major expense associated with travel and vacations is transportation. About 44% of travel funds are spent on getting to, from, and around your vacation destination.

How much money do you really need to travel? ›

In general, you should expect it to cost between $25,000 to $35,000 per person to travel around the world for a year. This rough estimate comes from reading travel budgets of other bloggers, various travel planning resources, and our own experience.

Is it better to save money or travel? ›

In the end, the choice is yours

The choice between saving money (for say, a first home deposit) and seeing the world is a difficult one. There's no doubt that traversing the globe expands your horizons and provides invaluable life skills like independence, strength, resilience and self-confidence.

How do you calculate trip costs? ›

Working out how much a trip will cost
  1. Step 1: Track your expenses. ...
  2. Step 2: Research your destination. ...
  3. Step 3: Travel documentation. ...
  4. Step 4: Transportation costs. ...
  5. Step 5: Accommodation costs. ...
  6. Step 6: Day-to-day expenses. ...
  7. Step 7: Additional travel expenses. ...
  8. Step 8: Add everything together.

How do I know how much money to bring on a trip? ›

The general consensus is that you should have $50 to $100 in cash per day for each traveler. However, this amount could vary considerably depending on where you are vacationing.

How much should I budget for vacation vs salary? ›

Many financial experts suggest spending between 5-10% of your annual income on vacations each year. If you're striving to meet any important financial goals, like paying off debt or saving for a home down payment, keeping this closer to 5% can help you reach those goals more quickly.

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