Family vacations aren’t cheap. On average, according to the 2017 LearnVest Money Habits and Confessions Survey, Americans spend 10% of their annual income on vacations.
And if that statistic doesn’t concern you, then these might:
It takes Americans an average of six months to financially recover from a vacation.
74% of Americans say that they have gone into debt to pay for a vacation.
39% of millennials spend 15% or more of their annual income on vacations.
And speaking of millennials, 49% say they are actually willing to go into debt to pay for a big vacation (compared to only 18% of baby boomers).
But even if you are willing to go into debt, does that mean you have to? Consider this—LearnVest’s survey also found that 55% of Americans have forgotten to include vacations in their annual budget.
Yes, vacations are expensive. But if you budget your money properly, you can spend your time having fun traveling abroad with your children instead of worrying about the toll the trip is taking on your finances.
Planning Your Trip & Creating Your Budget
There are 7 key steps you’ll need to take in order to plan your trip and budget for your family's expenses:
Read on to discover helpful tips and advice for tackling each step of the budget creation process.
You won’t be able to accurately estimate how much your trip will cost until you pick out your destination. Certain places are much more budget-friendly than others.
If you’re having trouble settling on an affordable destination, you can check out Forbes’ list of the 33 cheapest places to travel.
The cost of travel doesn't have to break the bank. Read on to discover how to save on flights, car rentals, and public transportation as your family travels abroad.
Booking a Flight
You can use travel comparison sites like Skyscanner or Kayak to find great deals on flights. You might also want to consider downloading an app called Hopper, which uses data to advise you on the best time to book your flight. You tell Hopper when and where you’re traveling, and the app predicts when ticket prices will be the lowest.
Some airlines offer discounts to children under 12 who are flying internationally. It may be a good idea to contact your airline directly and ask them about child discounts. If your child does end up flying on a discounted ticket, make sure you are able to provide proof of their age when checking in for your flight.
"When planning an international trip, check flights from major airports you can easily reach. We drove an extra three hours to catch a flight to Paris, but it saved our family $2,000 on airfare compared to our "local" airport. It always pays to shop around."
- Karen Dawkins, Family Travels on a Budget
If you’re planning on renting a car at any time during your trip, make sure you factor in the need for car seats. Car rental companies will probably charge you around $10 to $15 per day to rent a car seat. This can add up, especially if you need multiple car seats. If you’re a member of AAA, then you can get free use of one car seat if you rent through Hertz.
Bringing your own car seat may be the best option. Note that most airlines will allow you to check car seats for free. Not only will this save you money, but it will also better ensure the safety of your child. In 2015, Consumer Reports sent child passenger safety technicians to two major car rental companies and found that one of them kept its car seats in a shed. Most were missing their owner’s manuals and many had missing parts.
So if you do rent a car seat from a car rental company, thoroughly inspect the seat before driving out of the lot. Make sure all the parts are there and that you know how to use it properly.
If you’re heading to a major city, you will probably end up using public transportation quite often. Make sure you do some research to figure out the best way to pay. Buying some sort of pass or travel card may be cheaper than paying per ride.
There is a good chance your children will be able to ride for free. For instance, children under 11 can travel free of charge in London.
Step 3: Choose Your Accommodations
A big part of your overall vacation expenses depends on what accommodations you end up staying in. From hotels to rentals to resorts, there are plenty of choices out there. Unless you’re lucky enough to have family or friends to crash with, you’re going to have to shell out some money for a place to stay. But how do you decide which one is the best option financially?
Renting a house, condo, apartment, or room is always an alternative to staying in a hotel. And there are plenty of sites to help you find your perfect home away from home.
With Airbnb, you can rent short-term lodging to stay in during your trip. If you’re not sure whether staying in a hotel or Airbnb would be cheaper, you can check out an analysis by Busbud of the average costs of hotels and Airbnbs in 22 cities across the world to help you make your decision. For instance, this study determined that hotels are cheaper than Airbnbs by an average of $139.42 in Barcelona, while Airbnbs are cheaper than hotels by an average of $108.29 in London.
Another popular vacation rental site is VRBO. Simply enter in your destination, arrival and departure dates, and the number of guests and search through countless rental listings.
You may decide to stay at an all-inclusive family resort, such as one run by Club Med. With this option, you will pretty much know the cost of your trip up front, which is a plus. But is it really a financially smart option? Yes, you will have access to food, amenities, and activities all in one place. But it doesn’t usually come cheap. On top of that, you could end up spending even more money than you originally intended if you decide to venture out and explore restaurants and activities outside the resort.
If you and your family do decide that a resort is the best option for you, make sure you do some research to figure out where you can get the best bang for your buck. You can start by checking out this list of 10 all-inclusive resorts where kids stay free.
"Family vacations can be tricky from a budget standpoint as school-age kids are all more or less free during the same periods, so families lose the flexibility that other travelers have to travel during the off-season to bring pricing down.
Best practices to make trips more wallet-friendly include booking trips as earlier as possible to maximize the choice of accommodations, as this can be the most expensive piece of a trip given that families usually need a suite or two rooms. Apartment inventory can work well to save money if families are staying in a destination long enough to meet any minimum stay requirements and/or make the lack of hotel-like amenities worth the cost savings.
There are a plethora of family-friendly resources these days that provide invaluable insight into the destinations and activities that are tried and tested with kids of all ages. We also recommend using an expert travel agent who specializes in families, as they will have a ready list of the best options and can put a fantastic trip together using vetted options."
- Amie O’Shaughnessy, Ciao Bambino
Step 4: Consider Your Dining Options
How much you end up spending on food during your trip can vary greatly depending on the city, your accommodations, and your tastes.
Preparing Your Own Meals
If you are staying in a rental, you can save money by staying in and cooking some of your own meals. This also gives you an excuse to explore local markets and groceries. You can check out this article for tips about successfully cooking in vacation rental kitchens.
Even if you are staying in a hotel, you don’t have to go out to a restaurant for every meal. Especially if you have a room with a microwave and/or mini-fridge. You can buy paper plates and plastic utensils and have some of your meals in your room. A loaf of bread and some meat and cheese, for instance, can go a long way and save you a fair amount of money.
Consider doing some research on restaurants before you leave. There’s a good chance that you’ll end up discovering other places you want to try once you actually arrive, but having a meal plan in place beforehand will help you while budgeting – even if you don’t end up rigidly following it.
You can search for restaurants in a particular location on TripAdvisor. If a place catches your eye, click the link at the top to visit the website. This way you can check out the menu to see prices and make sure it has something for everyone in the family, even the picky eaters.
Tips for Saving on Food
Here are a few more tips for saving money on food while on vacation:
If you stop by markets or bakeries near closing, you may be able to get baked goods at a lower price. These can be your breakfast the next day.
Be sure to pack reusable water bottles for everyone. You can fill them up at your hotel before you head out for the day so you’re not constantly buying overpriced bottled waters.
If possible, try to stay away from restaurants in the super touristy areas of the city. These tend to be more expensive than places that the locals frequent.
Step 5: Plan Your Activities
Try to plan your vacation itinerary out as much as possible before you leave. This will give you a better idea about the amount of money you will end up spending on activities and entertainment during your trip.
But planning things in advance does not mean that you need to obsessively schedule everything down to the hour. Vacations are full of surprises. It’s very unlikely everything will go exactly as you expect it to.
Instead, make a list of everything you hope to be able to do. And then prioritize. Put the things that you consider an absolute must-see at the top of the list and things you could survive without at the bottom of the list. If you get to them all, great! But if not, you won’t be heartbroken that you missed out on doing something you were really looking forward to.
Of course, that does not mean you can’t come up with a rough schedule. After all, there may be places you wish to visit that are only open on certain days. And there may be places that would make sense to visit on the same day due to their close proximity to each other. Just be aware that your plans may change. Be prepared to be flexible.
Here are some sites where you can look for deals on vacation activities:
Be sure to also check out the official tourism website for your intended destination. You might be able to find special offers there. Additionally, the site may have a page specifically dedicated to activities that are fun for kids, such as this one on the Visit London site.
It can be tempting to blow your money on souvenirs and local wares while on vacation. One way you can prevent this from happening is by deciding ahead of time how much each person in the family will be allowed to spend while shopping during the trip.
Step 6: Determine Your Costs
You will know the cost of certain things—such as your flight and accommodations—before you leave for your trip. But you’re obviously not going to know exactly how much you will end up spending total on food and entertainment. If your planning is thorough enough, however, you should be able to come up with a pretty accurate estimate.
You may also want to check out a site called Budget Your Trip, which allows you to research the average travel costs for cities and countries around the world.
"When it comes to budgeting for a family trip, it's probably best to set aside some money in a category marked "miscellaneous unknowns" for things that come up that you weren't initially planning on. Also, remember between most moms and dads, there is usually a spender and a saver. When the two work together to create the budget, this will eliminate arguments and make for a much more fun vacation where everyone is on the same page! Flexibility, realistic expectations, and open communication are key."
- Tanya Raedeke, Rad Family Travel
Step 7: Save Up Before You Leave
Make sure you aren’t one of those people who goes into debt to pay for your vacation. There are plenty of ways to cut back on spending in your day-to-day life so that you have plenty of money saved up by the time your departure date arrives.
AND REMEMBER: It’s never too early to start saving for a vacation. In fact, the earlier you begin, the better. Let’s say you’ve determined that you need $4,000 to cover the costs of your trip. If you start saving a year in advance, then you’ll need to save an average of $11 a day.
"Avoid debt. Your trip will cost a lot more if you pay high credit card interest rates on it for months and years to come. Pay cash or pay off your credit cards in full immediately after your trip. Pick affordable destinations closer to home while you save up for big trips. When you pay off unnecessary debts, you'll be able to travel more often for less money. Some credit cards come with great travel benefits, and they'll pay you to travel if you pay off your balance in full every month."
- Allison Laypath, Tips For Family Trips
Additional Money-Saving Tips
Saving a few dollars a day should be no problem - all it takes are some adjustments to your daily routine.
- Cut out the coffee: Think about much money you could save if you cut out your daily trip to Starbucks. For instance, eliminating a daily $4 coffee expense could save you over $1,400 in just one year. If you can’t live without a regular caffeine fix, you can always make your coffee at home instead.
- Stop eating at restaurants: The average American household spends $3,008 per year on restaurants and takeout, according to the U.S. Bureau of Labor Statistics. Cooking at home can save you money.
- Meal planning: Don’t throw a bunch of impulse buys in your cart while at the grocery store. Make a list based on your meal plans for the upcoming week and stick to it.
- Buy generic brands: You’ll probably discover that the generic or store brand versions of your favorite foods and other items are just as good as the name brands.
- Start a garden: You could end up saving money on produce. Plus, it could be a fun hobby to get your kids involved in.
- Don’t buy right away: Say you’re on Amazon and you see something you want. Don’t immediately proceed to checkout once you’ve added it your cart. Wait at least 24 (maybe even 48) hours. There’s a good chance that owning the item won’t seem quite so necessary anymore.
- Remove credit cards from your online accounts: You’ll probably cut back on impulse buys if you delete your card information from online accounts such as Amazon. Being forced to get up and dig your card out of your wallet gives you a little extra time to think about why you don’t actually need the item.
- Babysitting swap: Is your neighborhood full of other families with young children? If so, see if you can find another set of parents to swap babysitting nights with. When they go out, you can watch their kids and vice versa. This eliminates the need to pay a babysitter, which can end up saving you a large chunk of money.
- Save your loose change: If you throw about 50¢ in a jar every day, you’ll have saved nearly $200 in the span of a year.
- Take advantage of discounts: There are deals everywhere if you know where to look. Check out this guide to promo codes, coupons, and deals.