How to Plan a Travel Budget

Identify the expenses you will have when you travel. You need to know where you are going, whether you are hitting the high or low season, how much to budget for food, where you will be staying and how you will get around. You can compare prices on the Internet and search for the best deals ahead of time, helping your budget stretch further. The more accurate you are about these details, the more helpful your budget will be.

Make reservations for lodging ahead of time. You can book hotels using international travel or hostel websites and take advantage of competitive pricing when you book in advance. You can even reserve and pay for many transportation expenses and for entertainment in advance. Not only does this let you know exactly how much these expenses will be before you travel, but this also means you will not waste time searching for a hotel when you get there or miss an event because it is sold out. Some things, like the Eurail Pass, are cheaper if you order them from the U.S. rather than waiting until you get to your destination.

Account for all expenses in your travel budget, including travel documents, luggage fees, tips and trip insurance. If you need a passport, you will save money by applying for one a couple of months before traveling and avoiding the expedite fees. Compare the prices and services for travel insurance. These can vary greatly and are worth the research. Also inquire about foreign transaction fees your bank might charge you and make sure you will have access to your money when you need it. If you are traveling overseas, you may want to exchange some money ahead of time or at least know the exchange rate and how much you will pay for the exchange.

Tally all the expenses you anticipate for each category -- such as lodging, food, transportation, entertainment, spending money, travel documents and travel-related services. Add up the costs for each category. It's helpful to have a subtotal for each category so you can see where your money will be going. Check out budget calculators on the Internet to help make this easier.

Pad your budget slightly for unexpected expenses. It is impossible to predict every penny you will spend; you want to have some flexibility in case you come across something that is too good to pass up but is not in the budget. Add at least an extra 10 percent to the budget for the unforseen, or more if you can afford to.