Woman swimming in the ocean on vacation

How To Plan a Vacation on a Budget

Who doesn’t need the occasional break from their daily grind? Vacations are a great way to get away from it all, travel and explore. 

And unless your idea of a vacation is watching The Great British Bake Off from your couch for a week (technically a staycation) – traveling can get real pricey real quick. And planning a vacation will be even more challenging if you’re on a tight budget.

But you shouldn’t let money get in between you and a well-earned getaway. Use our travel tips to plan a vacation on a budget that doesn’t skimp on fun!

Picture Your Ideal Vacay

Think about what kind of vacation you want before you start booking tickets.

Here are some questions to get you started:

  • What type of climate do you want to vacation in?
  • Do you want to visit a trendy city or a remote getaway?
  • Are there attractions you must see or activities you must do?
  • Do you want to drive or fly to your destination?
  • Do you want to immerse yourself in a new culture or stick to the touristy stuff?

While you’re mentally scrolling through your vacation ideas, start jotting down destinations that match your responses.

Set a Budget

Knowing where you want to go and why you want to go there should help you set a budget and trip expectations. It’s natural to want to visit all the sights and eat all the foods, but if you’re on a budget, you’ll need to be realistic about what you can afford.

If you already have a monthly budget, start there. You should see how much money you’ve saved (or need to save) to take the vacation. Knowing how much you can afford to spend should give you a better idea of where you can go and how to break down your vacation expenses.

Prioritize what you’ll spend the most money on

When you set your budget, consider:

  • Travel airfare or gas money and travel expenses at your destination (think: Ubers, trains or buses)
  • Housing
  • Food and drinks
  • Activities and spending money
  • Souvenirs
  • Emergency cash

When your budget is tight, prioritizing what you want to spend the most money on is key. For example, if you want to try lots of food and activities, try saving on airfare and local travel or skip the souvenirs. If your priority is to live it up in a luxury hotel suite, you may need to slim down your activities budget.

Look for ways to cut costs

Here are a few ways to cut costs on vacations:

  • Book housing with benefits: Look for a hotel with breakfast and happy hour included or a hostel with community meals and free laundry to save money.
  • Avoid eating out for every meal: If there’s a kitchen where you’re staying, buy groceries and cook some of your meals. We’re not asking you to cancel your reservation at the trendy rib joint, but making light breakfasts, lunches and snacks can save you money.
  • Stay nearby: You can also save money if you’re not in the center of the action. Consider staying in a city or town close to your desired destination. For example, if you’re going to Paris, you can stay in the town of Sceaux, which is 30 minutes away from the city by train.
  • Use discounts: Take advantage of every discount code and coupon you can get your hands on. Discounts are a great way to slash costs.

Use rewards credit cards

Want to put your credit card spending to good use? If you have a rewards credit card, cash in on the points or travel rewards you’ve earned to help offset some of your vacation expenses.

You can also use your rewards card on your trip to earn points for your next vacation. Just make sure you can pay off whatever you spend so you’re not returning home to a pile of bills after your vacation.

Travel with a group of friends

While you may want to travel solo or with your bestie, traveling with a group has a major money advantage: the cost of the vacation gets split between everyone. And if your group is large enough (at least 10 people), you can likely score group discounts and rates on travel, hotel rooms and activities.

Being in a group would drastically reduce the amount you spend on your vacation. Not to mention, there is usually safety in groups. And if you’re traveling someplace new, it wouldn’t hurt to have a group of people with you.

Plan a shorter trip

Shorter trips can be cheaper than a week-long (or weeks-long) trip. If our plane ticket is expensive, a shorter trip can help you save on accommodations, food and activities. If you keep the trip short and can drive to your destination, your getaway will only get more affordable.

When your vacation is closer to home (think: a quick getaway upstate or a weekend staycation in a cool hotel), you can enjoy all the vacation vibes without breaking the bank.

Choose Your Destination and Date Wisely

When you’re on a tight budget, choose your destination and travel dates based on your budget – don’t force your budget to fit your dream vacation. If you put your vacation before your budget, you’ll likely blow your budget. And you’ll only risk heartbreak when you choose a destination before you know you can afford it.

Once you know what you can spend, spend some quality time on travel search engine sites to explore different destinations and figure out the cheapest time to visit. Some sites even let you estimate travel expenses at your vacation spot of choice.

Go during the off-season

If your destination has a peak season, it has an offseason. Traveling during the offseason can help you save money.

Generally, the best time of year to travel is spring or fall. Avoid traveling around major holidays, summer breaks or large festivals – unless that’s why you’re traveling in the first place, so you should expect to pay more.

If your vacation is for a specific purpose, attraction or activity, like going to Disney World or visiting Machu Picchu, planning your trip when there’s less demand can help you save money.

Watch for destination-specific deals

Do you know where you want to go? Track airline prices online to lock in the best price. Better yet, sign up for travel alerts to get notifications on flight deals.

Look for last-minute deals

If you don’t care so much about where you go, you may be able to snag last-minute deals that would be cheaper than flights booked months in advance. However, last-minute prices can change quickly. If it works for your budget, grab it! A great deal could be your ticket to a destination you thought was out of your price range.

By the way, they don’t call it “last-minute” for nothing. With some deals, you may only have a day to prepare to travel  – so a high tolerance for spontaneity (and an unexpired passport) would be a good thing.

Look for Alternative Housing

Hotels can be expensive, especially if they have fancy amenities you’ll never use. To cut costs, look for alternative housing options, like vacation rentals or hostels. Some alternative housing options are:

Alternative Vacation Housing Options

Inns or motels

They replicate the hotel experience fairly closely but are usually cheaper.


Hostels provide communal living spaces (think: gathering areas, bathrooms and kitchens) and private bedrooms or shared rooms with bunk beds. Hostels are usually pretty cheap. And if you don’t mind sharing space, hostels are a great way to meet other travelers.

Vacation rentals

Rent an apartment, a house, a van or even a tree house. If you can imagine it, you can probably stay in it. Check for rentals on sites like Airbnb, Vrbo or HomeToGo.

Couchsurfing or room rentals

Use Couchsurfing to find local, vetted hosts who let travelers stay on their couches, air mattresses or spare rooms, usually for free. You can also find rooms to rent in people’s homes on sites like Airbnb.

Staying with a loved one

If you’re lucky enough to have a friend or family member who lives in or near your desired destination, you can save a lot of money by staying with them.

Hotels typically provide security that other types of vacation housing may not. Check for safety measures and look for lots of positive reviews.

Plan Your Time and Be Flexible

Creating an itinerary can be a great way to stick to a budget. You’ll be less likely to go over budget if you’ve planned your time.

When you’re planning, book reservations for dining and activities in advance. You’ll have a better shot at doing everything you want, and you may get early bird pricing or discounts.

But it’s a vacation, not boot camp. While you should certainly plan activities, leave some room for the unexpected. 

Connect with locals

Consider swapping out high-priced touristy experiences with lower-cost local experiences. Think how much you’ll enrich your experience by immersing yourself in a new culture.

Tips for Affording Your Trip

Before you start planning, we’ve got some tips to help you better afford your trip.

Think about your current expenses

Before you get back to fantasies of skiing in the Alps or enjoying a plate of jerk chicken in Jamaica – ask yourself if it’s the right time for a trip.

If you don’t have enough money saved or your budget doesn’t have much wiggle room, your dream vacation could become a financial nightmare.

Prioritize saving over spending

Tight budgets can feel like a pair of jeans after a holiday dinner – uncomfortable and restrictive. But if you can temporarily give up a daily coffee habit or cancel a magazine subscription (or two), you might find more room (aka $$$) to save for your vacation.

Ask for money instead of gifts

If you’re planning your trip super early (think: before a wedding, birthday or Christmas), consider asking your friends to forget the gifts and give you money instead.

Have you ever considered crowdfunding a vacation? You should reserve this option for a special occasion, not a quick weekend getaway, but crowdfunding your vacation may be something to consider.

Vacation loan

So you want to go on vacation but don’t have enough money saved. And if you wait until you do, you don’t know when this vacation will happen. Well, you may be able to get a vacation loan to help with your trip expenses. The loan can be helpful if you don’t have a credit card or don’t plan on using your debit card during the trip.

While your vacation may last a week, you’ll be repaying the loan for months or years. If your vacation is worth taking out a loan, make sure you can handle repaying it on time.

Your Destination Awaits

Vacations don’t have to break the bank and empty your savings. You can enjoy a budget-friendly vacation by prioritizing what’s important to you, choosing a destination based on your budget and finding ways to cut costs.

The Short Version

  • When your budget is tight, prioritizing what you want to spend the most money on is key
  • Choose your destination and travel dates based on your budget – don’t force your budget to fit your dream vacation
  • Hotels can be expensive, especially if they have fancy amenities you’ll never use. To cut costs, look for alternative housing options, like vacation rentals or hostels
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