There are many blog posts about budget travel and how to travel longer for less. Most of them are bullshit. While it is important to spend your money wisely, being stingy is counterproductive, as you will not enjoy your trip.
I prefer to travel efficiently. This means: maximising opportunities for experiences while minimising the cost impact; making compromises according to your level of tolerance for discomfort.
Treat time as a commodity. There is always an opportunity cost. For example, cooking for yourself will save money but waste time. You will also miss out on valuable experiences like enjoying delicious local food and experiencing the unique ambiance of a local restaurant – i.e. the reason you went travelling in the first place! Time saved could instead be spent on working, studying or rejuvenating.
Here are my top tips to travel efficiently:
Pick cheap destinations
- Save at home; spend in a cheaper country. This is my most important travel efficiency tip. If you want to maximise your hard earned cash, travel long term in countries which are relatively cheaper than your own. In expensive countries, stick to the highlights. Most people spend wildly in expensive countries, like Italy, and never fulfill their travel goals because they’ve blown their budget on extravant purchases! Of course, there are exceptions. You can’t just pop over to New Zealand for the weekend for example. In this case, you need to save longer and prioritise saving for travel over other luxuries. For example, it is better to save money at home by not eating out, then eat out for much more cheaply in your cheap destination country. There are many websites to help you find cheap destinations and estimate the cost of travel in specific countries.
- Stay in dorm rooms in hostels. Personally, I hate dorms and would never stay in one. There is no privacy. You won’t get any sleep because drunk people will wake you up in the middle of the night or there will be loud snoring. You will catch every cold and flu going. You will waste time having to pack up all your stuff every day and secure your valuables. However, in expensive countries like New Zealand, sometimes it’s the only option for those on a tight budget. It comes down to the level of discomfort you can tolerate.
- Go camping. Buy a tent. Have an adventure. This has its own disadvantages – you have to transport it, find a secure place to erect it, put up with the vaguaries of the weather, etc. There is also an opportunity cost due to the time and trouble to put it up and pack it again every time you move. You will save money, but waste time. Personally, I hate camping. Other people love it for the experience.
- Stay with locals. I once met a woman who travelled for 3 years around South America without paying for accommodation. She simply knocked on people’s doors until some family agreed to take her in! While I would not recommend this approach for safety reasons, it shows that it is possible. I prefer to use services such as Airbnb. Airbnb is controversial, as it has contributed to the undersupply of apartments for locals in tourist hotspots, like Lisbon. On the other hand, you have the opportunity to experience local life in authentic neighbourhoods. Another great option is Couchsurfing, a service to connect you to local hosts for free. The system is based on trust and it is customary to offer some small gift to your host as a token of your appreciation.
- Book ahead or just turn up? Back when I started travelling in the 90s, it was common to rely on guidebooks or word of mouth. Now, we have the internet and a wealth of information and reviews websites, which have taken the risk out of booking in advance. Many booking websites offer loyalty discount programmes. I personally use Booking.com and get up to 20% off selected accommodation with their Genius loyalty programme.
- Take taxis. Contrary to advice on budget travel websites, taxis are actually a very efficient way to travel and maximise your travel dollar. Taxis will often get you from A to B much faster and more comfortably than local buses. In many parts of the world, such as South East Asia and Eastern Europe, taxis are extremely cheap. In other places, such as the Middle East and North Africa, shared taxis are the norm for traveling long distances. Of course there are exceptions. Taxis can be expensive in western countries such as New Zealand. But budget ride and car sharding services are popping up everywhere – the most obvious example is Uber. Taxi drivers are also a mine of local information, handy when you first arrive in a new place, assuming they speak English of course.
- Avoid overnight buses – fly instead. Take a long distance bus and save $$. Ths is one of the biggest myths of budget travel. The idea is, you sleep in the bus and therefore save a night’s accommodation. Well that is only if you are one of the lucky people who can sleep on buses. I, on the other hand, must endure a night of slow torture followed by three days trying to recover the lost sleep. This is inefficient, as I don’t get to maximise the time in these days for sightseeing or other activities. While it might appear you are saving money, you are actually not, due to the opportunity cost. For example, if you take an 18 hour bus ride in Argentina instead of a 2 hour flight, you have lost 16 hours – effectively a day. This means you will have to travel for an extra day to do all the things you planned to do. If your travel costs are say, $100 per day, then you have hardly saved any money at all! Or you will have to skip that day and see and do less! In an overnight bus, you don’t see any of the landscape and it is considerably less comfortable than flying. My advice – take short local bus rides in the day (maximum 6 hours) to see the countryside, then take tactical flights using budget airlines for longer distances.
- Avoid international flights – use domestic budget airlines and buses/taxis instead. Unlike in Europe, where budget airlines proliferate, international flights can be extremely expensive in other regions, especially Africa and Latin America. For example, I once paid $US500 for a 2 hours flight from Rio to Buenos Aires, as Aerolinas Argentinas had a monopoly. There can, however, be a way around paying extortionate airline prices in countries with cheap domestic carriers. Book a local flight to the destination nearest to the border. Hope on a bus or taxi to get you across the border to the nearest town with an airport. Take another local flight in that country to get you to your destination.
- Book flights in advance. A lot of research has been done about the optimal time to get the cheapest fares based on airline algorithms, etc. It is common knowledge that the cheapest flights are available 6 weeks prior to the departure date as airlines will start lowering prices to sell seats, but will increase them again from the 6 week mark. This conventional wisdom has been shattered by Covid. High demand and inflationary pressures have pushed up the price of flying and it is better to book as early as possible, especially during high season.
- Get credit cards with airmiles. This tip really only applies to the US, where you can keep changing credit card providers, which offer generous sign up bonuses. In Europe, this is only really worth it if you are a frequent traveller, as the card fees don’t make it worth while for occasional travel.
- Eat in local restaurants. Again, this may seem counterproductive, as cooking for yourself in hostel kitchens or over a campfire will generally be cheaper than eating in a restaurant. But as already stated, there is an opportunity cost to cooking – shopping, preparation and cleaning up all take up valuable time which could be spent doing something more productive. You need to find a balance. Cook for yourself in expensive countries, like New Zealand; eat out in cheaper countries. Even in more expensive countries you can find cheap local eateries, Mom and Pop style joints serving up decent, basic food at reasonable prices.
- Don’t take recreational drugs. Specifically I am talking about alcohol. I am not saying don’t have fun, but if you are really serious about traveling as efficiently as possible, you should avoid alcohol. There are several reasons for this. Firstly, alcohol can be extremely expensive due to the high tax levied in many countries. For example, in New Zealand, a glass of wine in a “cheap” pub can cost as much as meal! Alcohol lowers inhibitions and leads to bad decision making, like splashing out on expensive luxuries. Alcohol is extremely addictive: it has a fast onset and short duration, resulting in compulsive redosing – i.e drinking more and more alcohol! Hostels know this and deliberately allow guests to run a tab in the hostel bar. When not handing over cold hard cash, you can easily lose track of your spending. Finally, alcohol has extremely harsh side effects – high doses can result in nausea, headache and vomiting (known as a “hangover”). Again, there is an opportunity cost – time spent recovering from alcohol poisoning could be spend more productively. If you must drink, then try to limit yourself to moderate, irregular consumption. If you know you have a problem with drinking, skip it altogether. Getting fucked up in a foreign country in unknown conditions can lead to bad outcomes. For example, I once met a Canadian guy in Peru. He went out drinking one night in Lima and picked up a local woman. They went back to his room. He was so wasted, he didn’t notice whe she ripped him off of all his cash and expensive camera. On another trip, I went out for a few drinks with a German guy in Zanzibar in Tanzania. He was already drunk when we left the hotel and didn’t bother to count and secure his money before putting in the hotel safe. The next day, he claimed the hotel had robbed him. He called the police, but could not prove anything! I could go on and on.
- Don’t take valuables out on a night out. This tip also falls into the area of safety. Don’t take anything out that you can’t afford to lose. Just take enought cash for the evening and leave all valuables at home. I once met a woman in Nicaragua who took her valuables in a handback to a bar. You can imagine the outcome – she lost her passport and wallet with all her cash and credit cards.
- Bargain, but don’t bargain hard. In many parts of the world, bargaining, especially in markets, is de regueur – i.e. part of the culture and expected. It is also important to bargain to keep costs of services down – locals get priced out of goods and services and prices for tourists rise – it’s basic economics that the price adjusts itself according to the perception of the ability of the tourist to pay.. On the other hand, don’t bargain too hard, especially for cheap goods and services. The people in these countries are not as well as you and have to hussle for a living. The fact that you can travel, even if on a tight budget, means you are rich by their standards. Squeezing every last cent of small transactions is just tight.
Don’t cut your nose to spite your face
I travelled long term for many years and had to make my budget stretch as long as possible. I made some bad decisions which taught me some valuable lessons. For example, in Delhi in India, to save $2, I took a rickshaw to the airport instead of a taxi. I remember being so proud of myself and my expert negotiating skills! Well, the last laugh was on me, as it was winter and I almost froze to death. In Jerusalem, I opted not to visit the Temple Mount due to the high entry fee. I will probably never go back there and really regret that decision. The point of these lessons is that, while it is important to spend your money wisely, it is just as important to enjoy yourself and not lose sight of the reason why you travel in the first place – to have amazing, life-changing experiences.