How to create a travel budget and stick to it, according to someone who’s been traveling abroad for over 2 years

Courtesy of Natalia Lusinski

When traveling, creating and maintaining a budget is essential.
From researching your destinations in advance to using money-tracking apps, there are many tactics that can help you do so.
Here are seven ways to create and manage your travel budget.
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For more than two years, I’ve been living and traveling abroad, mostly in Europe. As a digital nomad, I work remotely and tend to switch countries every one to three months.

While many of my expenses are less than what I spent living in my hometown of Los Angeles, having a budget — and sticking to it — is still necessary. It’s easy to overspend when you’re not in your home country, and no one wants to have to cut a trip short because they’ve exhausted all their money.

So, coming from someone who’s made a living working and traveling abroad, here are seven my best budgeting strategies, whether you’re on a quick vacation or a long-term visit in another country.

Figure out what you can afford to spend and make goals in each major spending category

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Everyone’s travel budget is different. For instance, as a budget traveler, I aim to spend up to $25 a night or $750 a month on housing, usually renting my own Airbnb or a room in someone’s house. With a little research and negotiating, I’m able to meet this monetary goal more often than not.

If I end up spending more than $25 a night, I reduce my budget in another area, such as food. For instance, I’ll spend less per week on groceries or eat out less often. Or, I’ll stay with friends or family for a week, or a few, to make up for the unexpected housing cost increase.

Use travel and currency apps

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Apps also come in handy while balancing traveling and budgeting.

One travel must is the XE app, so you can quickly see how your location’s currency measures up to your currency back home.

Meanwhile, Trail Wallet tracks your spending by the trip or month. You can set a daily budget, add your expenses, and see how you’re doing — and where you’re overspending, such as on transportation or food.

To see your whole trip at a glance, the TripIt app is helpful. Once you download it, each time you book something, like a flight or rental car, you forward the reservation to plans@tripit.com and it’s added to your master itinerary. Not only can you access the app and your itinerary when you’re offline, but you can also share it with others to keep them in the loop.

To better track your spending, pay in cash

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As someone who didn’t use credit cards during my first two years of living abroad, I learned to withdraw a certain amount of cash each week with my debit card — and I stuck to that amount. This way, I’d avoid extraneous ATM fees each time I used one that was out-of-network, which was 100% of the time.

Otherwise, I’m charged hefty foreign transaction fees — which add up fast — such as 3% with every purchase when using Chase’s Freedom debit card. So now, I use my debit card and visit ATMs as little as possible while continuing to pay in cash as often as possible.

In addition, certain cities tend be cash-only more than others. For instance, I was surprised how many restaurants didn’t accept cards in Berlin, whereas it’s the norm in Reykjavik. Also, if you find yourself at street fairs and farmers’ markets, or negotiating housing, having the country’s currency on hand will be to your advantage.

However, if you do use credit and debit cards on your trip, make sure the one you’re using doesn’t charge foreign transaction fees. For instance, Charles Schwab’s Bank Visa Platinum debit card is a good option. Plus, the company will reimburse you for any ATM fees that were not in your network.

Rewards credit cards like the Chase Sapphire Reserve credit card are also optimal for traveling.

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Source: Business Insider – feedback@businessinsider.com (Natalia Lusinski)