How to budget for spending money when travelling

Posted by on January 6, 2014

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Travelling can take a lot of organisation, and one of the most difficult tasks is budgeting. When heading to a destination with different currency, predicting how much money you’ll need and how to exchange it can be mind-boggling. Check out our guide for tips on preparing for overseas spending.

spending money when travelling

spending money when travelling

How much money will I need?

In order to avoid the inconvenience and cost of purchasing too much foreign currency, and to prevent taking along too little cash so that you end up unable to buy what you want and need, you will need to estimate how much money you will spend on your trip.

Basing predicted costs upon prices at home may not be effective, as differing economies mean varying prices. Numbeo has a useful cost of living database containing information about prices of different goods and services in countries and specific cities across the globe, which will help you get a good grasp of how much the likes of meals and transport will cost per day.

If there are specific attractions you want to visit or things you want to do, it’s a good idea to learn the ticket prices by accessing the relevant websites. Add these expenses to your other estimated costs for the duration you are visiting, and you will have a reasonably accurate figure showing your forecasted expenditure. You probably want to take a little more than this amount as spending money, so that you have a buffer.

How should I exchange my money?

The next decision is what form this money will take. Usage of traveller’s cheques are in decline, meaning that you may find redeeming them difficult. Most people find cash or prepaid currency cards more convenient.

Prepaid currency cards, such as the Cash Passport from MasterCard, are used much like a debit card. However, as they are pre-loaded with the balance you require, they are not linked to your bank account. This means that you can enjoy the convenience and security of a card, lock in an exchange rate, and avoid going over-budget.

However, it is still a good idea to take along some cash: this will be useful for small purchases, cash-only transactions such as taxi fares, and tips. If you want to use only cash, try to take out only what you need each day and keep the remainder securely locked away in a safe.

Concerned that you might miss out on must-have purchases because your budget didn’t anticipate them? You can still buy that designer handbag in Milan or that vintage bottle of wine in Bordeaux – conveniently and without hefty fees – by taking advantage of the money transfer service from Travelex International Payments AU.

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