How to save money while seeing the world

This is a guest post from Matt Kepnes, who writes about travel and more at Nomadic Matt. His advice has been featured in The New York Times, CNN, The Guardian UK, Lifehacker, Budget Travel, BBC and Yahoo! Finance among others. Kepnes is the author of the just-published How to Travel the World on $50 a Day.

Forget what the magazines say about travel. Forget what you see in commercials. They’re all wrong: Travel isn’t expensive. How do I know? Because I’ve been traveling the world for six years and have found that everything you learn about travel is generally wrong.

Experience has taught me that travel isn’t expensive. Locals don’t spend hundreds of dollars per day in your destination — and you don’t spend hundreds when you are home — so why do something different when you travel? Traveling taught me that there are myriad ways to cut expenses and turn your dream vacation into a reality a lot more easily than you might think possible.

We’re conditioned to believe travel is expensive for few reasons.

• First, large resorts, hotels and tour companies have enormous marketing budgets that can afford advertising in those glossy magazines.
• Second, those same companies also charge a lot of money for their products, meaning those who sell them can get a higher commission. Few promote the downscale options, and as a consequence we’re left assuming travel is a luxury few can afford.

But that’s all wrong. Spending a lot of money on a holiday doesn’t mean you’ll have a better time than someone who goes budget. Plus, those exclusive resorts and hotels isolate travelers from the locals and culture we flew all this way to see.

So how can you have a first-class trip without having to spend first-class money? Forget everything you ever learned about travel and travel like you live back home.

Take, for example, a trip to Paris. If I’m flying from Chicago to Paris and spending two weeks in a hotel there, according to Expedia.com it would cost $1,500 or more (the closer to the city center, the higher the number). If you’re traveling with a family, you can multiply that by four.

That’s a ridiculous amount to spend on a single trip. Seeing that price would discourage anyone from traveling and further reinforce the idea that travel is too expensive to enjoy if you are not rich. How can a middle-class family afford that kind of money multiple times a year, or even once a year? They probably can’t.

But there’s no reason any trip should cost that kind of money. With a few simple tricks, you can cut that cost by more than 50 percent. At that price, travel becomes a lot more affordable.

Tricks to travel cheap
So how does one cut travel costs? Here are some ways to keep costs down on different aspects of travel.

Flights
One of the best ways to save money on flights is to be flexible with your travel dates. The difference of a day can potentially save hundreds of dollars. Fly midweek instead of on the weekend. Fly with stops instead of flying direct. Small things make a big difference.

To take the biggest chunk out of the cost of flying, sign up for a travel-related credit card. By using sign-up bonuses and milking the reward systems, I’ve used these cards to collect over 500,000 frequent flier miles in the last year. A family of four can fly anywhere with those kind of miles!

Here are some quick tips on using travel credit cards:

• Sign up for a branded airline credit card. Whether you love Delta, fly United and the Star Alliance, live and breathe JetBlue, or are hooked on Oneworld, all U.S. carriers have a branded travel credit card that may give you 25,000 to 30,000 bonus miles when you sign up and make one purchase. That’s a free economy ticket right there. Airline credit cards are the best way to kick-start your mileage balance.
• Sign up for a non-airline credit card. A Starwood American Express card offers a 10,000-point sign-up bonus, and when you convert 20,000 points into miles, you get a 5,000-mile bonus. I highly recommend signing up for this card too, but signing up for any “points” card like the AmEx travel card or a Capital One card will do. Afterwards, you can transfer your sign-up bonus points to the airline you use and redeem them for flights.
• When using the cards, pay off your balance each month. These cards are pointless if you are buying stuff just for points!

Lastly, watch for special promotions. I sign up for all the airline mailing lists and always watch out for special two-for-one-mile deals. Airlines offer jaw-dropping deals all the time, but they don’t last long and if you aren’t constantly looking for them, you’ll never find them. The three best to join are Johnny Jet, Airfarewatchdog, and mine. We all watch out for deals and will alert you so you can get them while the getting is good.

Accommodation
Get out of the hotels. Outside of flights, accommodation is usually the biggest travel expense. I never stay at big, expensive brand hotels unless it is free on points. Otherwise, they become too expensive to consistently stay in over the long term. There are far better and cheaper places to stay.

Even hotels can be inexpensive, if you know where to look.

Here’s how to find cheap accommodation:

• Hotel deals. Getting a sweet deal on a hotel is actually really easy, especially if you are in the United States. Simply head over to Priceline or Hotwire and bid on rooms. When you know your dates, visit Better Bidding first to find winning bids for similar rooms, then use that as your baseline. I used this method to get a hotel room in Times Square, New York, during Christmas for $85 U.S. per night. (A huge bargain!)
• Stay with locals, stay for free. Use Couchsurfing or similar sites like Global Freeloaders and Hospitality Club to find a local who’s willing to host you during your visit to their city. You’ll get a free place to stay (sometimes a bed, a couch or an air mattress), a local who can help show you around, and the chance to learn a bit about the local culture. It’s a much better way to learn about a city than staying at a hotel.
• House-sit. Another thing you could do is house-sit. In exchange for watching and cleaning someone’s home while they are away, you’ll get a place to stay in the area you are visiting. You can do this for a week or three weeks. You get full access to the house and usually a car. It’s a good way to save money, especially when you’re a large group. Good house-sitting sites include Mind My House, House Carers and Luxury House Sitting.
• Go camp in a garden. The concept is simple: people offer their gardens for you to camp in. You can search for suitable sites by place, and they range from the basic “here’s a spot for the night” to the more glamorous that offer full access to the house. Most locations are in the British Isles and Europe, though there are a few spots dotting the rest of the world. Check it out at Camp in my Garden.

Transportation
Forget the private coaches, taxis and tourist buses; take local buses or trains. It may be easier to get in that tourist bus, but learning the local transportation system saves lots of money. Even in expensive countries like Norway or Sweden, the city train is never more than $4 U.S. It may take some time to figure out the map and where you need to go, but that’s half the fun of traveling, right?

Public transportation timetables are available at the information booth at the airport and your hotel or hostel.

Other things to do:

• Get train passes. Train passes are offered in many regions of the world and can represent a 50 percent decrease off the price of train tickets. These passes will either allow you a set number of train rides or unlimited rides for the duration of the pass. If you plan on using the train system often, you need to strongly consider this option.
• Buy fare cards. City metro cards provide a considerable discount off buying point-to-point tickets. Even if you are going to be in a city for only a few days, you can usually buy a set number of tickets for a cheaper price. For example, in Paris you can buy a carnet (card) for $16 U.S., which is $6 U.S. less than buying them individually. In Bangkok, you can purchase day passes for the subway for $4 U.S. for unlimited travel; in New York City, the metro is $2.50 U.S. per ride but a seven-day pass is only $29 U.S.

Food
A week’s worth of groceries is cheaper than a week’s worth of restaurants. I generally find that I spend about $40 to 50 U.S. per week on groceries, as opposed to $20+ per day at restaurants. That’s a reduction of 70 percent in food expenses.

Consider cooking part of your meals, even on a short vacation, as food costs add up quickly. A snack here and a dinner there and you’ll be wasting a lot of your money. The majority of hostels, guesthouses and shared apartments offer full kitchens where you can cook your meal. Even if you are staying at a hotel without a kitchen, you can still prepare your own food by making sandwiches.

While we all love to travel to try new food, you don’t always need to do so by eating at a restaurant. Supermarkets are a great place to learn about the food of a culture. How people eat, what they eat, and what they don’t eat tells much about how they view food, life and health. Explore the local markets in your destination as you prepare your meals and you can learn and save money at the same time.

• Lunch specials. In many parts of the world, especially in Europe, you can dine on dinner menus at lunch special prices. The plate of the day, as it’s called, is the best bargain in the world. For example, while I was in Barcelona, I went to eat at the seafood restaurants near the beach. However, dinner was around $50 U.S. Yet coming back the next day for the lunch special allowed me to get the same meal for only $20 U.S. Another destination that’s great for this is Singapore, a very expensive place by Asian standards. Food here can cost as much as it does back home. Yet restaurants here have fixed menus for lunch that cost between $10-15 U.S. as opposed to $25 U.S. for dinner.
• Refill your water bottle. You need to stay hydrated when traveling, and buying water every day costs money. Get a metal water bottle or reuse your plastic water bottle a few times to save money. It may only save a small amount of money each time, but over the course of a long trip that can really add up. If the tap water in your part of the world isn’t drinkable, you can use a Steripen to purify your water, save money, and reduce your use of plastic bottles and waste. They’re good for 3,000 uses and cost as little as $60 U.S. That’s a lot cheaper than 3,000 bottles of water!

Sightseeing
The best money-saving device is also the least advertised. City passes are tourism cards that provide discounted and free entry into a city’s museums and activities, as well as provide free public transportation and discounts on some restaurants and shopping. In Paris, the museum pass saved me $80 U.S. In London, I saved more than $100; in Oslo, $30.

The bottom line
As you can see, it doesn’t take much to lower the cost of a trip. Just like getting rich slowly is about smart investing, savings and reducing unnecessary expenses, so too is making travel a reality by getting out of the normal paradigm of “go to Expedia, book a trip, and eat at fancy restaurants.”

By thinking outside of the box when you travel, you can drastically cut your holiday expenses while enjoying a much more authentic experience. I know we all want a break from the routine of life and a little pampering when we’re on vacation. There’s nothing wrong with that; it’s something I like too. But a memorable trip doesn’t have to be expensive!

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This article is about Budgeting, Travel