Budgeting for A Year Abroad

So how much does it cost to travel abroad for a year?  I’ve had that question from just a few people but I think many more do wonder about the costs.  I’ve decided to detail my expenses here because I was helped by bloggers who did so before my trip, so I hope this can helpful for others who are planning extended travel.

Things to Consider

The first thing to know is that there is not just one answer to this question.  I met travelers who would spend as little as $10,000 in a year, and others who easily spent more than $50,000.  There are many factors to consider when making your budget.

  1. Where will you travel?  Traveling in developing countries is generally cheaper than traveling in more developed areas such as North America, Europe and Australia.  Still, costs can vary greatly from one country to another, so it’s worth doing some research into the cost of living for where you want to travel.
Also consider when the high and low seasons are in each place for cheaper rates. Low season at Yosemite – No crowds!
  • How often will you move from one place to another?  One of the biggest expenses is transportation, so the more often you move, the costlier your trip will be.  If you want to see everything, you will pay for it.  
  • Will you share costs of lodging for all or part of your trip?  Sharing the cost of a hotel room can greatly reduce your lodging expenses.
  • What type of accommodation do you require?  If you can stay at hostels, then you’ll have pretty cheap and basic accommodation.  Most people I know (including myself) want a little more privacy and comfort.  I did stay at some very cheap or free basic places, but offset this was some “luxury” every now and then.  I usually had air conditioning when paying for a hotel room, and almost always had a private bath and breakfast included, usually for less than $20/night.
  • Are you willing to volunteer in exchange for free/reduced room and board?  This is a great way to really make your money go far and to get all of the benefits of volunteering with locals and getting to know the culture.
  • How much do you want to buy?  Since I was traveling light and had just cleaned out my house before selling it, I was not interested in buying souvenirs.  Having a lighter backpack also made it easier to travel.  I did purchase some photography tours and other arranged tours in a few places.  Other than that, I did all the planning myself, which can take some time but also saves a lot of money and give you more flexibility.
  • What expenses can you eliminate back home?  If you can sell your car, you eliminate the insurance payment and any car payment you have.  If you can sell your house, you can say goodbye to a mortgage payment, taxes, insurance, utilities, lawn care and maintenance costs.  Can you get rid of your phone plan?  Absolutely!  Just buy cheap local SIM cards in each country you visit, then stop paying a monthly bill.  And you can finally cut the cord – no more cable/internet bills.
  • Your credit card points can take you far away.
  • What can you sell?  Start now.  Look around your house and start listing those things you don’t need on Craigslist.  It takes a little work, gets you some cash, but best of all it will eliminate a lot of clutter and help you focus on what you really want – to travel abroad.
  • Sign up for a credit card with a 50,000 points offer.  I’m not a big fan of credit cards, especially if you have to pay for the privilege of using it.  However, there are several deals (I used Chase Sapphire) that offer 50,000 points and the first year with no annual fee.  This is worth it!  There is a minimum that must be spent in order to earn the points, so research carefully.  I paid for one international flight home from Asia, two round-trip domestic flights and rental cars in two cities with my points.  
  • Open an account with a bank that reimburses ATM fees. I used Schwab Bank and had fees automatically reimbursed every month.
  • Will you earn any income while traveling?  Don’t forget a tax refund, which could be significant since you will be earning less.  You might sell things during your travels that you no longer need.  There are always opportunities to teach English for money instead of volunteering.  You might be able to work online to earn some additional income.  Also, there may be grant opportunities available to you.  
  • What I Spent in One Year

    I used a Google spreadsheet and an app called Wallet to keep track of daily expenses.  Neither took much time and it was worth the effort.   There were days where I forgot what I spent and had to estimate, and I probably missed some expenses, but it’s still pretty accurate.  Keeping track of your spending is a great way to control your spending, no matter where you are.  
    I did receive a stipend from Fulbright for my expenses in Vietnam, but I included those expenses here for budgeting purposes.   Finally, I paid for a full year of health care from Cigna Global ($3800) before I left, which is not included in the total below since health care costs can vary greatly depending on the type of coverage you want.

    Year Abroad Expenses

    June 29, 2016 – June 29, 2017

    Countries:  USA, Honduras, Vietnam, Malaysia, Thailand, Cambodia, Philippines, Laos

    What’s not included:

    • Health insurance for 12 months ($3800)
    • Storage unit for 12 months ($1200)
    • Flight from Boston to Hanoi (paid directly by Fulbright)
    • Tuition for a one-week photo tour (funded partially through gifts)
    • Renting a PO Box for one year ($72)
    • Gift cards sent home to family for Christmas

    That’s it.  My only other costs were a life insurance premium and a leftover water bill from my house.  If you think $20,000 is a lot of money, well, it is.  However, it is far less than what I would have spent just living at home for a year and paying all of my usual bills and expenses.  So, when you think about it, I actually saved money by traveling for a year!

    Fun Facts

    • My lowest average daily expense was around $35 in Vietnam, Honduras, Philippines and Thailand.  Keep in mind that in some of these places I was getting free lodging and meals in exchange for volunteering.
    • The most expensive place, by far, was the US.  I spent around $100/day during my short trips to the US in August and May, and my lodging was already covered.  This did include some larger purchases for things I would need in Asia.
    • I made about $2200 selling items on Craigslist.
    • During one three-week period of volunteering, I spent a total of $4.88 and had one of the most incredible experiences of my life.

    I worried less about money during my year of not receiving a paycheck than I do when I get paid every two weeks.  Having a budget, knowing my expenses and living in cheap places made my travels stress-free in terms of money.

    Additional Resources

    You don’t have to be a millionaire to travel the world.

    Comments (10):

    1. LInda A Wight

      November 30, 2017 at 22:21

      Great Information, Tim – Don’t think I’ll be travelling around the world except through your eyes :). I enjoyed reading it and thought you planned well. ENjoy your blogs. Love, Linda

      Reply
      • Tim Flanagan

        December 10, 2017 at 14:34

        Thanks, Linda. It’s never too late to travel!

        Reply
    2. Lori Liguori

      December 1, 2017 at 07:26

      Very interesting, Tim! I love living vicariously through you!!!! Where are we going next!!! 🙂

      Reply
      • Tim Flanagan

        December 10, 2017 at 14:35

        I’m in the grant-writing stage now. There are many possibilities. I’ll know for sure in the spring, and you can definitely come along!

        Reply
    3. Sharon Eash

      December 1, 2017 at 11:27

      Great post, so informative! So happy for you that you were able to do this exciting adventure seeing the world. Have a Merry Christmas – Love From the Eash Family

      Reply
      • Tim Flanagan

        December 10, 2017 at 14:36

        Merry Christmas to the Eash Family!

        Reply
    4. Elaine

      December 2, 2017 at 16:09

      This is very very interesting!!! I want to clean house anyway so I love the idea of selling items…
      Great tips!

      Reply
      • Tim Flanagan

        December 10, 2017 at 14:36

        It’s kind of fun to get rid of stuff that’s just taking up space.

        Reply
    5. Sara

      December 3, 2017 at 17:11

      Melissa wants to know what you spent the $4.88 on?!?! 🙂 Great article laid out in a reader friendly way. I would agree that it was cheaper for us to travel than to live at home.

      Reply
      • Tim Flanagan

        December 10, 2017 at 14:38

        I didn’t even need to spend that money, but I ended up buying snacks now and then just to pass the time!

        Reply

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