Estimated reading time: 14 minutes
Learn how to budget to spend money while on vacation. Don’t let unexpected expenses ruin your travel plans.
The Best Way To Travel Is With A Travel Plan And A Budget
Whether you’re travelling by air or land, you will need some form of money to spend, no matter the destination.
When spending money on holiday, it’s critical to consider safety and convenience.
Travelling for free using Air Miles points, credit card rewards, or winning a free trip is fantastic, but you’ll still need spending money.
A simple road trip through Canada or the US or an international flight across the country may start with frugal intentions but can get out of hand if you’re not careful.
Even a camping trip or day trip to Niagara Falls, Wonderland, Toronto, Vancouver, and so on will all come with extra expenses you must budget for.
Research Your Travel Destination
When my mum and dad traveled to Canada from the UK, they asked me how much money they would need to spend.
They had never been to Canada before, so they weren’t sure about costs, so I gave them the run-down.
Even then, they still traveled to a local currency converter shop to swap British money with Canadian money.
It was partly my fault because I threw in a couple of extra road trips and tourist destinations that weren’t in the original plans.
We even took them to garage sales on the weekends that were not in the plans, and Dad bought a fishing rod and a few other bits and bobs.
Plus, they practically lived at Tim Horton’s for coffee, tea, and Boston Cream donuts, so I can partially blame them, too!
The same thing happened when we hosted our international students from Spain, Japan, and Germany since we could email each other before they arrived.
One of the first questions they asked us was, “How much money would they need to spend in Canada?” and for good reason.
No one should bring more spending money on holidays than they need to.
In fact, by creating a spending budget before you head out on holiday for any prolonged period, you should know the costs for the country you visit.
Cash Spending Money
Should you bring cash as spending money when travelling?
Yes, always bring cash in the currency of the country you are visiting and some from your country just in case you need to use the currency exchange for more.
You want to consider that exchanging your spending money at one exchange rate could easily change the next day.
So what was cheap yesterday may cost you double the next, or if you’re lucky, it will cost you less.
It’s always a gamble, although I remember visiting Canada in 2006 when the exchange rate was a whopping $2.52.
So, for every British pound, I got $2.52 Canadian.
It’s a sweet deal, but it’s not like that anymore, but still, it’s worth more, which means your spending will go further when travelling.
Also, consider that if you don’t spend enough spending money or plan to exchange money in the country you are visiting, you may pay more for the process.
Alternatively, you can use your credit card almost everywhere you travel worldwide; however, it depends on your travel destination and the exchange rate.
I’m not a massive fan of carrying travellers cheques instead of cash for spending money, but they are widely used.
If you bring traveller’s cheques, always keep a note of the serial numbers and other information with you and keep a copy at home.
When you get back, or if you can contact someone at home to contact your bank, you at least have the numbers.
The pitfall of traveller’s cheques is when you are in a country in the middle of nowhere; they become a piece of paper.
Cash is and always will be KING.
Even pre-paid credit cards are far more recognized and desired over the travellers cheques, although almost all countries will accept them.
You might find that your bank allows you to take money from an ATM outside of Canada, but you will pay international fees.
Travelling With A Toddler
When we planned our holiday to England two years ago with a two-and-a-half-year-old toddler, we decided to go on a stopover to get a connecting flight.
Taking this route wasn’t cheaper. It cost us a bit more money, but we were considering the overall experience for everyone involved.
We were travelling to a few destinations, so we needed not to bombard him with too much travel time on the airplane.
However, if we flew straight into England non-stop, it gave our son a break from being on a long flight.
We also thought about the passengers because traveling with a screaming toddler for hours is not much fun.
The twist is that he loved it, but what you don’t know before you book your travel tickets and what happens after is another story.
It turns out that we could have flown non-stop, but now we know that for next time, a trip to the UK from Canada will take only about 6 hours.
You will want to find out the currency exchange costs when you use it BEFORE you go.
In some cases, you may find the exchange rate on your credit card when visiting out of the country is not much more or the same as if you went to the bank.
Spending Money At The Airport or Docking Ports
If you are travelling and have a stopover or are stuck waiting for your flight at the airport, you’ll need to spend money.
There isn’t much to do at the airport besides spending money on food, drinks, liquor, cigarettes, and souvenirs.
The same applies if you are on a cruise ship that stops at different ports where passengers can get off to sightsee.
You’ll need to spend some money if you plan to experience what the country offers for the short time you are there.
I recall we did not go with any Icelandic króna while we were in Iceland. Luckily, they accepted American and Canadian money along with credit cards.
This is why having cash, credit card, travellers cheques, or a pre-paid credit card will be handy.
Even though you may despise the exchange rate, you may get on a credit card when travelling, having a life-line is better than not spending money at all.
Road Trips And Spending Money
Even when we would take long 8-hour road trips up north past Sudbury, Ontario, we would stop frequently at rest stops for breaks.
This is when we would get gas, use the washroom, and stretch our legs.
As a frugal family, we always pack enough food and drinks to keep our travel budget low on a road trip.
If you plan to go road-tripping outside of Canada, you must bring spending money in US Dollars as not all shops accept Canadian currency.
Travel Considerations And Your Spending Money
When budgeting for your holiday, you’ll want to know how much money you will need to bring along with you.
If money were not an issue, you wouldn’t be reading this, but you would want a rough idea for the average person, so I’ve got a few tips.
Let’s consider these situations.
Travel Budget
You won’t understand how much money you must spend until you create a travel budget.
You’ll need a budget once you know how much money you have for your entire get-away, whether it’s a day at Wonderland or a one-week all-inclusive holiday at a resort or on a cruise.
Once you have your budgeted amount for travel, you can plan your holiday.
It will also help you balance paying for your holiday and show you how much money you will have left to spend.
If you go on a holiday with a blind eye to the money, you’ll spend too much and feel the financial strain when you get home.
For example, if you have $5000 to spend in your travel budget and the cost of travel insurance, plane tickets, and resort costs is $4000, you both have $1000 of spending money.
Now, depending on where you are going, $1000 might not be worth that much.
Using a simple currency Converter, you will find that CAD 1000 in the UK is worth 587.34 Great British Pounds.
When writing this post, the exchange rate was 1 GBP = 1.70.29 CAD1 CAD = 0.587340 GBP, but that can change tomorrow.
So, always consider local currency costs when creating your travel budget.
That same $1000, if you were traveling from Canada to the United States of America, would be worth USD 742.25.
At the time of writing this post, the exchange rate between Canada and the USA was 1 USD = 1.34724 CAD1 CAD = 0.742256 USD
All-Inclusive Travel
We spent almost three weeks in an all-inclusive 5-star resort in Spain, and all food and drinks were covered, but that’s about it.
Anything else outside of the buffet meant dipping into your travel money.
- If you wanted your clothes laundered, you had to pay.
- If you wished to buy toys for the beach, you had to pay for them.
- Snacks and local food also cost extra.
Even if you plan trips outside of the resort with a travel guide, this will cost you money.
Mrs. CBB recalls an all-inclusive trip to the Dominican Republic; however, she still had to pay for a tour guide trip to see the lands.
She also paid to get her hair braided and to have fresh coconuts on the beach, which is quite familiar to destination all-inclusive beach resorts.
Even in Spain, we had women walking up and down the beach selling melon slices and, at night, men selling souvenirs along the path-way of the beach.
Just because you think you are going to an all-inclusive resort or travel destination doesn’t mean you won’t need to spend money.
You WILL.
Travel Itinerary
What are your plans when on holiday or a road trip?
Do you plan to participate in any overseas adventures or day trips with a tour guide that is not part of your travel package?
You’ll pay for that, too.
Tips WhenTravelling With Spending Money
Carrying money when travelling is great, but you must protect yourself and keep cash handy simultaneously.
I’ve travelled to many places worldwide and done my online travel research by reading about others’ experiences, so I’ve learned what to do and what not to do.
If you are a first-time traveler, whether by land or air, you’ll want to secure the money you spend with you at all times.
Below are the most valuable tips I’ve used and recommend to anyone who sets off on holidays, whether camping, road trips, airplane or boat travel.
It’s better to be safe than sorry.
Split Spending Money Up
There is a reason why you must split your spending money, and we did this on our recent trip.
I’ve always done this everywhere I’ve travelled for two reasons: haggling and safety.
Almost all the countries I’ve visited invited haggling prices, especially when no price was displayed.
If sellers see you spend a lot of money because you pay with large denominations, the haggling might not go so well.
For safety reasons, if you are mugged or someone tries to steal your wallet/purse, if you store all of your spending money and credit cards in one spot, you’ve lost them all.
If you divide your cash and credit cards or other currency spending into different spots, you will have some form of money to pay for things.
The last thing you’ll want is to be stuck on a road trip or in another country with no money, trying to call home for someone to wire you cash.
Bring Smaller Denominations of Local Currency
Always exchange your spending money for travelling for small bills, so you have cash for tipping and bartering.
Before leaving our resort hotel room, we plan to spend money for the day in the local currency.
In one pocket, we would carry coins and small bills; in secure zippered spots, we’d have larger bills under our clothing.
You don’t want to be announcing to everyone how much spending money you have if you don’t need to.
Keep Spending Money On Your Body
You can now buy clothing with money zippers or inside pockets where you can stash your spending when travelling.
It also helps to keep it safe from falling out if you are on a road trip, venturing into the forest, or bumpy places where roadways aren’t paved or have no sidewalks.
Carry A Fake Wallet
I lost my wallet once while travelling, and it wasn’t because it fell out of my back pocket either.
I made the mistake once and never again because I put myself in a vulnerable situation.
Luckily, my girlfriend had spent money with her at the time, and we could continue on our holiday without too much downtime.
They got no credit cards or identification but got my spending money.
If you plan to venture off your all-inclusive resort or are travelling to a country where crime rates are high, or you’re worried about being mugged, always bring a dummy wallet.
Whether you are male or female, buy a cheap secondhand wallet and put some fake money, business cards, or even coupons inside to make it seem legitimate.
If you are mugged or someone tries to pick-pocket your pants or purse, they can steal the fake wallet rather than get your real cash.
This is why we suggest always keeping your spending money on your body rather than in a purse or backpack.
Do Your Research
Before buying your plane tickets or even booking time off from work, research your planned trip, whether it be a short weekend road trip, a quick trip to Vegas, or a long flight overseas.
Leaving armed with knowledge and plans is the best way to ensure your spending money stays safe and you know how much to bring.
Discussion: Have you ever been on a trip and stuck with little to no spending money?
How did you handle the situation?
Leave me a comment below, as I love reading your feedback and opinions.
We are leaving Canada in July for a trip to Oklahoma and New York. Great things to think about in this article. Thanks for the tips. I like the fake wallet idea.
Hi Tyler,
Thanks for your feedback. Being that I went through it the fake wallet idea is what I always do now. It’s best to be safe. Have fun on your holidaysin July sounds like fun.