Money Talk

* Budget in Cambodian Riel, hotel for 150 is equal to $37 for example. 

So how in the world do you pay for a trip around the world? That’s the big question and stumbling block for many people, especially people with kids. It’s not easy, but we met lots of traveling families, from single parents to families with four kids (all of whom are old enough to require their own plane tickets) who are neither wracking up piles of debt nor independently wealthy. Through a combination of creative financing and careful budgeting, it’s possible to do this yourself.

First you have to get into the right mindset. There’s a big difference between taking a vacation, where the aim is to relax and recuperate, and traveling, where the aim is to see and experience the world, as much of it and for as long as possible.

It took me a while to get my own head straight. Before we left, I was sure that we were too old and too established and I was far too fussy to travel like backpackers, staying in hostels or cheap hotel rooms. I got myself excited for our trip as much by searching out nice lodging and pretty airbnb apartments online as reading up on Ethiopian culture or the temples of Angkor Wat.

But once we hit the road and I started recording every birr, schilling, metical, rand, rupee, bhat, kip, dong, riel, kyat, won, and yen that we spent, my attitude changed pretty quickly. We could book the fancier hotel room in Luang Prabang, but that would mean foregoing the day trek to the Hmong villages. If we took overnight buses rather than flying in SE Asia, we could stay longer in Japan. Once the tradeoff became clear to me– the less we spent on housing, the more fun cool stuff we could do — it almost became like a game to see just how little we could spend on wherever we were laying our heads that night.

Of course, we still had our standards: we almost always had a private bathroom and wifi in the room, and we never stayed anywhere that was dirty or felt seedy or unsafe. But there were a few dinghy guesthouses and lots of generic hotel rooms in the mix. Also we never booked two rooms and so the four of us were often on top of each other, literally, sleeping in two twin beds. At the same time, we splurged for places with pools when we could, weren’t shy about asking for better rates for longer stays in order to afford nicer digs, and stayed in lots of cheap places that were simple, comfortable, and lovely. When possible we rented airbnb apartments, which are often less expensive than other lodging options and allow for self-catering and the pleasures of a home life too, not to mention an extra bedroom.

Also, traveling, yes, like a backpacker, is fun. You become a part of that roving international community of world travelers, trading tips on great spots and how to get there, sharing crazy stories about broken down buses and eating worms by accident, and the time the hippos trampled your campsite (that really happened to a couple we met). You watch the driver of your crowded minivan tie to the roof the rooster that he’d accepted as payment from a local woman after a protracted roadside negotiation. And eat at a roadside stand in the middle of nowhere the best Pho of your life that tastes all the better for costing less than one dollar. You make fast friends with the fellow diners at the night market, when all the lights suddenly go out, plunging the tented alleyway into darkness, until people start illuminating their smart phones and leaning them against water bottles to fashion beautiful improvised lanterns, and the proprietors light a few stubby candles and stick them in beer bottles, and the delicious food keeps coming, and it feels like you are at the biggest, rowdiest, most cosmopolitan dinner party ever.

When you travel on the cheap, you have more opportunities to brush up against real life—or at least a tourist life where the locals aren’t getting paid to be nice to you.

So how much does it cost?

It all depends on where you go and how you get there. Obviously there is no upper limit, but we never met any families who were doing this trip luxury style. On the other end of the spectrum, a family of four can travel all through South East Asia and India for as little as $25-30k for nine or ten months. I know lots of families who added on Indonesia, Sri Lanka, Malaysia, and the Philippines (which all require flights to get to) and kept their budget to around $40k for nine months.

Of course, $25k, 30k, 40k is still a big chunk of change for many people and it’s hard to save up that amount, but most U.S. families spend more than that on living their regular lives at home. That’s also the sum for a mid-range kitchen renovation or a nicer new car. Thinking about the money this way can make the sum feel more in reach.

Most people break up their budget into travel, meaning the flights (or rail passes) between or within countries, and then daily living, which includes everything else: accommodations, food, activities, sightseeing, and any purchases. In our case, we folded internal travel within our daily living budget whenever possible. It’s necessary to also budget for some expenses before you go, like luggage, vaccines and medicines that can easily run to a few thousand dollars. And then there’s visas, which range from free (South Africa, Korea and Japan for a U.S. citizen) to $20 per person (Mynamar) to $75 per person (for India, which has since become easier and cheaper).

Because our itinerary involved numerous long legs across three continents, travel was a big cost of our trip, about a third of our entire budget. But I know a traveling family who were able to purchase their round trip tickets to Thailand for a family of five using points they spent a year accumulating using a method described by The Points Guy, which involves moving debt from one credit card to another. Once in Thailand, it’s possible to travel overland to Cambodia, Laos, Vietnam and Myanmar. Budget carriers such as Viet Jet and Air Asia offer legs to Malaysia, Indonesia, Sri Lanka, and the Philippines as low as $25 per person. By taking advantage of their frequent sales and avoiding checking luggage, you can fly all over Asia for $59 or $79 a leg.   As a result, this family’s travel ran a few thousand dollars, representing less than a tenth of their entire budget.

Daily Budgets

The costs vary by location. There are a lot of great family travel blogs that detail the costs of travel by country. I’ve included a list of links at the bottom of this post. As a rough guide, here are some costs for a family of four for the places we visited:

$100 a day: India, Laos, Vietnam, Thailand, Cambodia.

It’s easy to find very nice lodging for under $40 a day, local transportation is abundant and cheap with rides only a dollar or two, and you can find good cheap street food or dinners around $15 for four at local restaurants.

$125 to $140 a day: Myanmar

Since tourism in Myanmar is still fairly new, the lodging supply hasn’t yet caught up with the demand and the price increase from the rest of South East Asia is due mostly to higher lodging costs.

$150 to $200 a day in Sub-Saharan Africa

Africa was the first leg of our trip and we weren’t yet in the swing of how to travel cheaply, so we spent more on accommodations in some places than we needed to. In Ethiopia and Uganda, the shared taxis that most locals use to get around didn’t always go near our destinations, and we ended up taking taxis or hiring drivers, which added significantly to our daily expenses. Also, the entrance fees to many sights were significant, and we’d often hire a local to guide us on top of that, all of which added up quickly.

That said, the one-week trip we took to visit the tribal people of lower Omo Valley in Ethiopia, which required a guide and driver, remains one of the best experiences of our entire trip and felt well worth it. We did a self-drive safari in Kruger Park in South Africa for less than $200 a day, which is much cheaper than any other safari options we could find. In Cape Town we rented a beautiful two-bedroom apartment on the sea and a car for the month we were there, which increased our budget but was yet another huge highlight of our trip. When we go back to Africa, I’d like to travel overland more via the local buses, work harder to find more affordable guest houses and do some camping to help bring the costs down so we can see more of that amazing continent.

$165 a day in Korea and $175 a day in Japan

We found that the more developed a country is, the more expensive it is. But it’s also easier to book lodging online and use public transportation to get around and find street food venders or food market chains where you can reliably find something cheap and healthy for your picky son to eat. So it’s easier to control the costs than in some other places and the standard of everything is higher. The chain hotel rooms are nicer, the trains are faster and always on time, the street food is good quality.

Our visit to Japan coincided with a major holiday so our housing options were limited. Had we planned farther in advance, we could have spent a bit less than our average of $70 to $90 a night on lodging. They also typically charge per person rather than per room, adding on $30 or $40 a night, even when your extra person still bathes and sleeps in the same bed with you. We had better luck negotiating with airbnb hosts to forgo the extra person charges or lower them, especially when we were able to fill a hole in their calendar and they saw what great reviews we had received from other hosts (and had left for those properties too).

                                                                    ***

These travel costs are based on traveling at a medium pace, with about one country per month, with slightly less time in the more expensive countries. If you travel slower and can rent an apartment somewhere for a month or two, than you can spend much less. When we first arrive in a new destination we always overspend, because we don’t yet know where to get good street food or a market where we can pick up supplies to make our own lunches or how to get around without taking taxis.

Finally, I know some traveling families who don’t keep a running budget and simply try to spend as little as possible at all times. That didn’t work for us, because we aren’t very disciplined and we can’t help indulging ourselves with a good meal or some shopping.   Initially, we kept going over budget and feeling guilty and anxious in the process. So I started writing down everything we spent. This way we could splurge on some jewelry in India or a beautiful statue in Mynamar as long as we stayed within our budget.

I even managed to interest the kids in our nightly tally of how we did each day, and how close we were to saving up the funds for some treat like riding elephants or kayaking. If this trip teaches them (and us) the value of keeping a budget, than the return on our investment will be, as the commercial says, priceless.

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So now that you have a sense of what it can cost, let’s consider the financing. The people we met, on the road and online, generally pay for their extended travel in some combination of the following ways:

Sabbatical

Obviously, this is a select group of people, and the easiest way to fund a year of travel. But college professors such as my husband are not the only people whose jobs offer sabbaticals. We were surprised to learn that a high school history teacher from a Philadelphia public school was entitled to a sabbatical (and that other school systems in the U.S. offer them), and that teachers in Canada can elect to participate in the “five over four plan” where 20% of their salaries are deferred for four years and then they earn 80% of their salary over the fifth year during a year off. More and more companies are offering as part of their benefit package the opportunity to take a sabbatical, with varying lengths of time and percentages of compensation available. Is your company on this list?

Rent or Sell Your Home

We met numerous families who were able to sustain their life on the road by either renting out or selling their homes. If you own your own home or apartment and live in an international city with high rents, such as New York City, London, Paris, Sydney, and aren’t carrying a huge mortgage or maintenance, it’s entirely possible to live of the rental income of your home. We rented out our home in Brooklyn semi-furnished, selling all the stuff we didn’t need and storing the rest of our personal belongings in our basement, and that income has helped to fund our travel. We met a family who lives off the rental income on an apartment in London and other families who sold homes in England and Australia and decided to forego buying a bigger place and taking on bigger mortgages to fund a year of travel and live differently upon their return.

I am a homebody (which is probably one of the reasons I became a writer) and I love our home in Brooklyn. I can honesty say it’s my dream home—a Victorian brownstone filled with original details and light, and it never ceases to amaze it that I get to live somewhere so beautiful. Before we left, I didn’t think that I’d trade it for anything in the world. But the longer we are gone, the less the idea of a fixed home, and all the headaches and financial worry that come with being a property owner, matters to me.

I have felt at home in a futuristic 300 square foot loft in Busan, Korea, and a charmless hotel room in a former country club in Kampala, Uganda, and a thatched roof bungalow on a beach in Cambodia. If I have music and NPR, a way to cook a simple meal once in a while, along with a handful of spices, and my family around me, I can feel at home anywhere. There’s something to be said for traveling light on the road and in life in general. At the same time, I’m grateful that our home allows us freedom by paying for itself and then some, if ever we need to rent it out.

Working on the Road

Earning money while traveling or through traveling can be a tough nut to crack, but many people seem to make it work. For families who are traveling indefinitely, this is the only way to make it work. The most common method seems to be web design or some online web-based work. I know of people with portable skills like teaching scuba diving or working as a private chef who manage to make some money on the road. I can’t speak to the legal ramifications of making money in foreign countries, but I’m sure you can find lots of blog posts on the subject.

There’s a large group of travel bloggers and freelance travel writers who earn their living through their writing and blogging. The secret here seems to be having a big following and developing multiple income strands. Ytravel.com, an Australian family who has been traveling around the world for three years and has a million followers, breaks it down very clearly in this post. The short answer is a combination of referral fees from online booking sights like Agoda and Booking.com, click-through revenue on product purchases, and product sales, usually of self-published eBooks that tell you how to earn the money to travel or get extended visas in Spain or teach science through geocaching or access the free or share economy of couch-surfing and housesitting, and so on.  And then there’s free trips offered by brands or tourism boards or sponsored posts where someone writes about some travel-related product or place in exchange for free stuff or payment.

Some of these people actually earn money writing about travel too. But as someone who makes her living as a writer, landing travel writing gigs is a lot harder than I expected. There are so many travel writers and even more travel bloggers already who are willing to do this work for what is often a pittance. An article that can take a day or two to report and another day to write might pay $100.  If you are passing through a place for a few weeks, it can be hard to track down the kinds of off-the-beaten path stories that editors want.  But if you have a big following, it’s possible to land a travel column, which you can also use to promote your blog and the various ways you make money off of it.

It takes at least a year or two to build your social media platform to the size that makes you interesting to a tourist board or marketing person.  This means connecting with a wider traveling community and using Facebook, Twitter, Pinterest and Instagram strategically, and most of all creating interesting useful content. All of this requires a big time commitment, but the traveling families who stick with it do eventually see a pay-off , not only in terms of accumulating more followers (and the free stuff that goes with that), but also through sharing this profound experience with like-minded strangers.

Savings

I’ve read many inspirational blog posts and article by people who manage to save up for their trips around the world in as little as one or two years. (I’ve linked to some at the end.)  They talk about canceling cable, cutting their food budget and eating at home, foregoing annual vacations, earmarking their tax refunds, giving up going to the beauty parlor, and so on.  Once you start focusing on your trip, it’s a lot easier to say no to those new boots you really want (because you aren’t going to wear them in South East Asia).  Before you know it, you’ve saved $20k, which is enough to pay for six months of travel at least.  Some people might disagree with me, but I don’t think you have to be debt free to justify putting these savings toward a trip rather than paying down your credit cards, as long as you don’t intend to increase your debt significantly during your travels.

We certainly weren’t debt free when we left, and yet, as we are getting closer to returning, I feel in a better position than ever before to earn more money and budget what we have to pay down those debts.  Traveling through unfamiliar terrain in sometimes difficult conditions gives a person a great sense of accomplishment and trust in their own abilities. Also, seeing the simplicity with which many people in the world make a home, cook a meal, and raise their families is inspiring.  Rampant capitalism, on display in the malls of Bangkok or the Chinese foam factory right next to the wildlife preserve in Ethiopia, is less so.

Being away from your usual routines and surroundings has a way of sifting your priorities, especially when it comes to what you spend money on.  It turns out that I must have my hair colored every six weeks—I’m not ready to embrace my gray–but I don’t care at all about manicures and pedicures or never went once to get a massage in South East Asia even though they only cost $5 for an hour. My family likes to eat simple (i.e. affordable) meals of rice or pasta and vegetables, rather than a meat, chicken or fish entrée every night as we used to.   Although I missed my wine, I’m just as happy, and feel better the next morning, with beer.  Good wine is too expensive to drink every night, and cheap wine isn’t worth the headache. And most of all, I don’t need to outsource childcare or stimulating activities for my kids as much as I thought I did. I can actually get some work done while they’re around.  And I am even looking forward to  making paper with them, like we learned about in Thailand and natural dyes like we learned about in Laos, and trying our hand at homemade noodles, like we saw in Vietnam.

The proof will be in the pudding, as they say, and I won’t know for a while after our return which of these life lessons will stick.  But one thing I know I’ve learned– the preciousness of time: I want to slow it down enough so that I notice all of its passing moments, and appreciate them, while also remaining aware of its constant forward march, so I am sure to spend it wisely.

Useful Links for Budgeting

Morgansgotravelling.com is a great blog about a family of six from New Zealand, traveling through SE Asia, Europe, and the U.S. for a year.  They have a detailed budget breakdown for every country they visit.  They also are masters at social media and wonderful photographers and writers, and gained a big following right out of the gate, which has translated into lots of nice perks for them.

WagonersAbroad.com is a blog about an American family of four who lived in Spain for two years before hitting the road and traveling to Europe and SE Asia.  They are traveling indefinitely and trying to make a living as they go.  The mom keeps a very detailed budget on every country they visit.

Worldtravelfamily.com is a Welsh/Australian family of four who have been traveling on and off since 2013 and also support a portion of their travel through blogging, along with the income of their rental home in Australia.  They have lots of great money saving tips on their site, both for before you go and while on the road.

Useful Links for Saving Money

MarriedwithLuggage.com features a couple who started saving for one year of travel and then were so successful at it, they ended up traveling for five years and counting.  Here’s an article about how they saved up for their trip.