For a traveller, managing your finances means more than booking cheap flights and hotels. Here are some financial tips for both before and during the trip.
Budgeting for essentials is hard enough; throw in the highly unpredictable factor of travelling and your finance is almost guaranteed to go out of whack. So how do you manage your money if you’re an avid traveller or someone who doesn’t want an occasional trip to completely drain their financial reserves? Here are some important tips.
Before Heading Out for the Trip
Your financial planning begins way before your trip does; in fact, you need to get your finances in order even as plan it. First, you need to clearly define your trip: where you’ll be going, where you’ll start, what you’ll do, why you’re going at all, and how long will the trip last.
These questions are important because they’ll give you some much-needed insight on things like cost of living and travelling through certain countries. You’ll find out whether you want to volunteer to reduce your expenses or participate in activities like skydiving that’ll blow them sky-high. You’ll also become conscious of the way you want to travel — whether it’s hiking through the mountains or conquering backpacking trails.
Next, you’ll need to determine how you’ll fund your trip. There are three ways you can approach this. You can retain your job and work while you travel, but you’ll need to plan the financial and logistical requirements for it.
You can find work along the trip and earn as you spend, but note that this method is much harder and can negatively affect your trip. Finally, you can simply use your savings for your trip. Whether you have a plan or not, start saving for the trip and adjust the budget accordingly.
During the Trip
So you’ve planned for your trip and set a budget. But you’ll need to take steps during your trip to make sure you’re on top of your finances.
- Use multiple debit and credit cards
Why do you need multiple debit and credit cards? Your bank cards can get stolen, get blocked by banks and locked in ATMs. So for whatever may be the reason you’re unable to use your bank card, you need a backup.
While you use your card from the main bank account, keep a second one as a backup. It doesn’t matter the second bank account charges high international fees; you’ll use only use in case of emergencies. If you’re a couple with a joint account, you should each have a card for the same account.
- Have cash at hand
Unlike your city, you won’t always find an ATM nearby on your trip. Even if there are ATMs nearby, they may not be working or may have run out of cash. So while you may not need cash often, it’s important to have some on hand regardless.
Note that your US dollars are widely accepted in many locations. Keep a mix of large and small notes. $100 and $50 bills usually get better exchange rates but smaller bills can be used for tips and visa fees. Finally, just because you have cash at hand doesn’t mean you use it for every transaction. Use your cards for transactions and pay using mobile in casino to limit your cash usage.
- Withdraw money as soon as possible
There’s no telling when and where you’ll the local currency in a country. So it’s highly advisable to make the ATM your first stop as soon as you arrive. But you’ll also need to know how much cash to withdraw within the daily withdrawal limit of your bank.
For this, know the exchange rate in a country before you enter it. This will also prevent you from getting ripped off when exchanging money from money changers. You can use any of the popular websites or apps that list the exchange rates.