Most people focus on saving money to travel. But can you save money by traveling?
It sounds counterintuitive, I know. But a hidden truth of travel is that – depending on where you go and what you do – your expenses while traveling can be lower than your expenses at home.
Adam and Alice, a couple in their early 30’s with no children, decide to spend one month camping in forests across Washington, Oregon and California.
At home in Seattle, their joint expenses are:
Utilities: $220/mo (gas, electric, cable, internet)
Cell Phones: $80/mo
Gym Membership: $80/mo
Insurance on Two Cars: $100/mo
Dining Out and Entertainment: $80/mo
Student Loan repayment: $100/mo
Adam and Alice realize they can slash a lot of these costs while they’re on the road.
Here’s their travel cost-of-living:
Rent: $0, after finding a renter to sublet for one month.
Utilities: $0; the sublet renter signs an agreement to pay the utility bills
Cell Phone: $40/mo; they put Alice’s phone plan on hold, since they can rely on just one person’s phone. Long calls to loved ones take place with unlimited night and weekend minutes.
Gym Membership: $0; on hold
Insurance: $50/mo, as they now only need to insure one car. The other car stays parked in a friend’s garage.
Dining Out and Entertainment: $0, as they’ll get all the entertainment they need from the adventure itself
Student Loan Repayment: $100/mo
Of course, they have to take on new expenses too. Gasoline during the road trip will run them $400. They’re planning on camping in national parks and forests, which means they’ll need a tent and camping mat ($100). They can camp for free on grounds managed by the Bureau of Land Management, which are abundant in the Western U.S.
They buy a mini-fridge for their car ($40) which is powered through an inverter that plugs into the cigarette lighter ($30). They also buy a camping stove ($40). These investments mean their grocery bill stays at its normal $175/mo, since they don’t have to dine out while they travel.
Monthly expenses: $765
Equipment cost (tent, stove, etc): $210
Total cost of living for the month: $975
Savings: Their cost-of-living while traveling is $760 less than their cost of living at home.
Is That “Real” Savings?
Are they actually saving? It depends.
If they’re using paid vacation or working remotely from their laptop, then yes, they are saving $760. (Paid vacation is a myth, but that’s a different story.)
If they have passive income that pays their home cost-of-living ($1,735/mo), then yes, they’re saving $760. (Heck, if their passive income pays even $1 more than their travel costs, they’re saving.)
If their income drops to $0 as they travel, then no, they’re not saving … but they’re spending roughly half as much as they do when they’re at home in Seattle.
In other words — the trip isn’t as expensive as people might assume. They’re taking a road trip for one month for less than $1,000.
Which means that when people ask “How could you afford to travel for a month?,” they’re asking the wrong question.