The Main Travel Budget Factor: Your Destination

$2 bed, $3 lunch in Nepal

There’s a lot of noise in the travel media about how to save money on your vacation, on how to get more out of your travel budget. The problem is, most of that advice is focused on the wrong things.

Close to a decade ago, I wrote in Make Your Travel Dollars Worth a Fortune that the main impact on your budget is going to come from where you travel, not how. Sure, there are many key factors that go into determining how much you spend on your travels, whether you are going for a one-week vacation or a year-long trip around the world. The primary one, however, is where you decide to spend your time.

Travel Destination First, Logistics After (unless there’s an airfare sale)

No matter how well you plan your trip to Japan or Norway, and no matter how good the flight price is, it’s going to cost you a buttload of money compared to say…Ecuador.

There was once an article in Budget Travel magazine they gave two writers a budget of $1,200 to travel with. The instructions were to go at least eight hours away for four nights and spend no more than that amount. One went to Tokyo and one went to Quito. You can just imagine how that worked out.

Basically the guy who went to Quito, Ecuador lived it up, ate well, and stayed in really nice hotels. This was his description of his last night at one of the best restaurants in town: “From the ceviche sampler to the grouper in a spicy cream sauce, everything was extraordinary. Along with champagne, dessert, half a bottle of sauvignon blanc, and tip, my total was $75.”

A $2.50 haircut or $15 massage in Quito

The guy who went to Tokyo had to be really careful with his money. He slept in a room that was 8′ by 10′ for $70 and mostly ate ramen noodles and vending machine food. “I kept my spending down by using a three-pronged method: eating at establishments that don’t employ waiters, never taking a taxi, and engaging with the locals.” He still had a good time, but it was tough making the math work.

Ramen noodle budget or eating out every meal? Capsule hotel/hostel bed or boutique hotel with soft sheets and plush toiletries? Taxis when you want or waiting for the bus? Amazingly, these two options can be the same price-wise. It just depends on where you go.

There are a few caveats of course. There are five-star hotels everywhere almost, so you can spend a lot of money anywhere if you want. Still, the top suite in Quito is going to cost you a whole lot less than the top suite in Tokyo. Plus flight prices can tip the scales a bit on a short vacation. If you find a return flight to Ireland for $700 and one to India is twice that much, it’s probably a wash either way because you don’t have as much time for all the other costs to make up the difference. If any international destination is less than $500 from your home airport in the USA or Canada, it probably makes sense to snag that deal regardless.

The Cheapest Places to Travel Will Make You Feel Rich

I’m in Ireland right now as I write this and I’m glad I didn’t come here as a backpacker. Prices are a bit higher than the USA if you just look at the numbers, but then you remember they’re in euros, not dollars, so you have to add 20%. Since this place is flooded with moneyed tourists on top, hotel prices are higher than they seem like they should be. Then if you go from here to London, prices will go up even more.

When I go to Vietnam, or Nicaragua, or Guatemala though, I feel like a rich man. I can get a hotel for less than $20, a great meal for less than $5, and a taxi across town will cost a couple dollars. Almost everything I could possibly spend money on is going to be a fraction of what it costs in other destinations. If we’re talking about Norway, it’s literally 1/10 the price for some items. If you’re traveling with a partner, the costs become doubly important. If you’re traveling long-term with kids, you really need to pay attention to destination costs on the ground.

So remember, keep your travel options open to get the best deals on the biggest expenses. But if you want to make a huge difference with just one choice, pick one of the cheapest destinations to start with. Want to see more specifics? Check out these rundowns of travel prices in Bosnia, Montenegro, Kyrgyzstan, Morocco, Peru, and Nepal.