Some people are lucky enough to not need a budget when they plan a family trip – unfortunately, that is not us! Making a family trip budget can be overwhelming, but it really doesn’t have to be.
There are no great secrets as to how to make a family trip budget. It is the same process as I followed when it was just me travelling, there is just a bit more to take into account. I basically split costs into two different sections – the one off items such as flights, and the per day costs for the trip which includes things like accommodation, food, transport, sightseeing, basically everything you spend money on day to day.
Before doing this, you need to decide what level of comfort do you require. Would you really be happy travelling as cheap as possible, couch surfing and staying in the cheapest beds? Or do you hate the thought of staying somewhere that isn’t five star? Somewhere in between? Are economy flights ok? Are you happy to travel the cheapest way possible, but need a great bed at night and some air conditioning? There are no wrong answers to these questions, but it is important that you figure out what is best for your family. Make sure you are honest with yourself. It can seem attractive to make a lower daily budget so you can afford to go away longer or further, but if you make it too low, will you enjoy the trip? Will you do everything you want to do? There is no point going away longer just to be miserable and uncomfortable.
I recommend working out the minimal comfort level you will be happy with, and then you can always add more to the budget later.
1. One off items
In this section, you include things like flights and travel insurance, and anything else that is a one off or big expense. For our upcoming trip, we only needed to include flights, as our travel insurance is covered in our credit card.
You may also want to include things like travel vaccinations or any special equipment you need to buy for your trip, such as a new backpack or travel cot. On our last trip, we ended up spending a fair bit on travel vaccinations, and we needed another suitcase and a new backpack. It adds up. If you travel often, these costs will probably be minimal. If you haven’t travelled for awhile or if it’s your first time travelling with kids, it’s worth considering these costs and adding them to your family trip budget.
2. Country per day cost
This can be the trickiest part, and it is why you want to be sure of your minimal comfort level before starting your budget. Once you have your comfort level, then you can work out the typical cost for accommodation, transport, food and activities in the area you plan to visit. I tend to split this up per country, as the cost can differ a lot between countries. You also need to make sure you include enough money to be able to buy things like bottled water and, for a family trip budget, extras such as nappies, formula etc. If I am travelling in very different ways within a country, I may split up the per day cost even further. For example, a different per day cost when we are doing our US road trip, compared to when we do our Caribbean cruise.
To work out the typical cost, I will look at accommodation sites to work out how much I can expect to pay on average for the level of accommodation we would be happy with. It is a good idea to look up a few different places you plan to go. For example, in the US, it is going to cost more to stay in a big city than an interstate motel. For transport, look up typical costs for the mode you plan to travel with. For example, if its flights, then look at flight booking engines. For buses, look at bus line websites. For car hire, look at car hire booking engines. Food can be a bit trickier and I recommend doing a google search for other people’s trip costs. A lot of people (including us!), blog about how much their trips have cost them. Otherwise guide books, such as Lonely Planet, can give you some ideas.
I basically use all this information to come up with a daily cost. I make sure there is a little bit of slack within it, but basically I try to make it as minimal as possible to a level we will be comfortable with. In this way, I can make sure we can afford our trip, and we can add money later, if we can afford to, to make it even more pleasant and nice and for special treats along the way.
3. How many days per country
After you have worked out a typical daily cost in each country you intend to visit, you need to work out how many days you will spend in each country. This time may be fixed, or it may be something that will depend on money. For example, maybe you have $2000 budgeted for daily costs, so once you work our how much you need for each day, then you can work out how many days you will be away for.
4. Add this all together
The final step is to add everything together. I use excel, and you can see a summary of our upcoming family trip budget here:
For our trip, we have the flights as our one off items, and then a per day costs for our time in the Dominican Republic, USA and cruise. This spreadsheet multiplies the per day cost with the number of days and adds it all together to come up with our total budget of $16,021.
What about contingency?
We don’t budget for a contingency as such. On trips where we are coming home to no jobs, we also budget for a couple of months when we get home. We would never spend every last cent anyway, so for us a contingency fund is unnecessary. We also make sure we have credit cards with us, so we have access to extra money if something was to go badly wrong. Depending on your own financial circumstances, you may want to budget some extra money for when things go wrong. Even if you have travel insurance, you are may have to pay for whatever it is and then claim the money back later, so you need to be prepared for this.
Another consideration is exchange rates. We made our family trip budget for our upcoming trip back when the Australia dollar was very strong. It then fell ten cents against the US dollar, although is coming back up again now. As our budget is calculated in Australian dollars, our trip is going to cost us more than what we calculated back in May. Unless you have a crystal ball, it can be hard to completely plan for this. However, I recommend you either have some contingency for this, say 10%, or ensure that you do have enough money in the bank to be able to up your budget if you need to.
We try to save extra money for extras, as our per day limit is quite low. This is money purely for extras though – so that we can afford things like cocktails on the cruise or a trip to Disney World. Stuff that we can do without if we have to without troubling us.
You can also read our tips about how to save for travel.
I hope someone out there finds this helpful! What tips do you have for creating a family trip budget?