The biggest excuses people give as to why they don’t travel is that they just don’t have enough cash.
While you do need money to be able to travel, you don’t need nearly as much as you might think, and folks are doing all sorts of creative things to help fund their journeys.
#1 Tip: Your RTW trip has to be your top priority
Saving up $10,000- $20,000 or more is not something that most people can do in any short amount of time, but it can be done if it’s a priority.
You have to look at this the exact same as if you were saving for any other big life event – purchasing a house, planning and paying for a wedding, having a child, etc (all of which can cost much, much more than long-term travel).
Many travelers, particularly those who are out of college and going down the path of what society says is adulthood, look at saving for a trip like this as an alternative to buying your first house. Instead of committing to a mortgage, commit to a big trip instead!
But you can’t start from zero and decide you want to leave on a RTW in 6 months. Most of the people who successfully save up money specifically for a RTW trip plan out years in advance (just like someone buying a house).
For many people the idea of long-term travel is a passing fancy during a frustrating time in their lives, but if you look around the travel forums here at BootsnAll, you’ll see that thousands of people caught the RTW bug and then achieved their goal through hard work and some sacrifice. The majority of people who have gone RTW are not rich, don’t have trust funds, and didn’t win the lottery. They were diligent and focused on a major goal. And we’ve yet to hear of a person who has regretted going RTW.
[figure title=”Saving Money for Your Trip” description=”Make Your RTW Trip Your Top Priority” src=”https://content.bootsnall.com/rtw/wp-content/uploads/2010/03/euros-grow.jpg”]
How to start saving
The most important thing to do is start tracking every single dollar you spend. Find out where all your money is going. Then really think about where you can make cuts.
Here are a few questions to ask yourself and what you can do to start cutting expenses right now:
- Do you spend a lot of money going out to dinner or getting carry out?
- If so, start cooking.
- Do you spend a small fortune at the bars?
- If so, start buying booze at the store and inviting friends over, or slow down drastically on your drinking (it will be worth it when you’re able to buy $0.25 beers on the street in Hanoi!).
- Do you like to shop?
- Stop now. You’re going to be ditching a lot of your stuff before you leave anyway.
- Can you live without cable? A home phone? A massive data plan on your phone?
- It all adds up, so prioritize what it is you really need.
If you’ve gone through your expenses and income and are only able to save a very small amount per month (or nothing at all), it may look daunting right now. Don’t worry, it will get better. You just need to get creative.
When you save for something big like this, you’re going to have to sacrifice and use some creativity to save the necessary amount of money – no one said it was going to be easy.
Check out these articles for tips and advice for saving:
- 28 Ways to Save Money for Travel
- What to Do With All Your Stuff While You’re Gone (and How to Make Money While Figuring it Out)
- 35 Long-Term Travel Budgeting Tips
- Working on the Road
This all sounds really difficult.
It is! This is why so few people travel the world. Society teaches us that it’s normal to sacrifice and save large chunks of money to buy stuff – houses, cars, etc. Saving for big purchases like that is also really difficult.
The difference is in mindset.
Cultural norms say that buying a house or lots of stuff when you have a job and money is an acceptable way to spend that money, but for some reason, spending the equivalent of a down payment on a house on a year of travel isn’t looked at in the same way, though it should be.
Open a savings account
Consider this account to be your “travel” money – it should be kept separate from your checking account, your nest egg (if you don’t want to spend that on travel,) and any other accounts. Do not open another checking account because you will be more tempted to spend that money.
Make a deposit schedule
View your travel fund as something you have to “pay.” For example, every month when you sit down to pay your bills, “pay” the dollar amount that you can afford to set aside into your travel account. We recommend dong this right after you receive a paycheck. By forcing yourself to part with your money right away, you won’t spend as much throughout the month.
Sell or rent your big items
If you are going to be gone for an extended period of time, like a year, there is no reason to have your car sitting in the garage (or on the driveway) at your parents’ place. The value of the car will only depreciate while you are away. If you will absolutely require transportation upon your return, set the money aside in another account, so you can purchase a better car when you get back. As far as housing goes, if you have a mortgage, you can choose to sell your house or arrange for someone to rent your place. If you’re well enough off that you don’t have to do that, do it anyway. A little extra traveling cash will be worth it.
Manage your debt
If you have student loans, car payments (not if you get rid of your car!) or a mortgage (not if you find someone to rent your house!), think about paying ahead on those items instead of paying them while gone. Or make sure you build any monthly payments into your travel budget and get everything set up to be paid automatically so you’re not worrying about making your student loan payment while you’re in the middle of the Amazon.
Do some babysitting, mow a few lawns, start waiting tables or bartending, or pick up another job that you can work once a week. It will suck, yes, but the more you work now, the more fun you can have later. Take that extra dough and put it in your travel account.
Cut corners in your spending
This is the biggest money saver before you leave. If you don’t already track your money, you’re probably going to be disgusted by how much you actually spend on things like going out for food and hitting up the bars. The good news is that by changing a few habits and using these cost saving tips, you can start saving so much more. Buy food that’s on sale, make your morning latte at home, go out to Happy Hour instead of a nightclub. Pack your own lunch, buy in bulk, see if your favorite restaurants have early bird specials. Saving 5-10 bucks a day adds up quickly. In some parts of the world, that’s enough money for the whole day!
Every dollar you save lets you travel a little bit longer. A great motivator is to tell yourself, “If I don’t go out tonight, that’s money for 4 nights’ accommodation in Thailand!”
Saving Money For Your Trip Checklist
- Figure out how much you can afford to save each month
- Open a savings account to be your travel fund
- Pay your travel fund each month just like it is a bill
- If you don’t feel like you are saving enough, consider getting a second (or third) job
- Cut back on unnecessary expenses like eating out, going to bars, shopping, etc.
- Sell or rent big items that you won’t be using while on your trip
- Go through all the stuff you’ve accumulated and prioritize what’s necessary to keep
- Put the stuff you don’t need/want on Craigslist or eBay for some extra cash