When preparing for long-term travel, the first thing you think of is your budget. We are asked all the time, how we afford to travel.
The quick answer is through a lot of saving, sacrifice, and determination. We are a normal family who has worked hard to achieve the “American Dream”.
We realized the “American Dream” is whatever we make it and does not have to be defined by having a house with two shining cars in the driveway and two perfect kids. Our dream is to travel around the world together as a family.
We determined our family gap year budget based on our resources. There is no way to know how much everything will cost. I will explain below how we estimated the cost of our family gap year.
If you are planning a family gap year do not forget to leave room in your budget. Life wouldn’t be life if unexpected things did not come up.
Expenses in the United States while traveling
We will only have one expense to pay when we leave the United States, student loans.
All our other debt is paid off and we plan to remain debt-free. I pay off our credit cards in full every month, to gain the benefit of credit card points.
We plan to sell or donate all our items before we leave. The few things that we would like to keep will be in storage with family.
How to make money during a family gap year?
We started this blog to not only help other families but with the hopes, we can turn it into a full-time job.
We love exploring, teaching, and helping others. I cannot think of a better job than to help other families do what they love.
Along with the blog, Mea will teach English online to cover small expenses. There are many different ways to make money on the road. Check out this article to see how to make money while traveling.
How did we determine our budget?
We spent hours online researching how much a family gap year would cost.
There is not much information on specific costs, so it was hard to come up with a number. I took an interesting approach and set up a “mock trip” to get cost estimates.
I searched for flights on different routes to get the average cost for a one-way ticket to different countries. This helped me determine the best airports to fly out of and which areas to avoid because of the high taxes and fees.
The average one-way ticket for domestic flights in Mexico is $70 and internationally to South America is $170.
I determined the average cost for our flights will be $580 per month including baggage fees. Luckily, our son can fly for free because he is under two. We do have to pay taxes for international flights, but the cost is minimal.
To determine the cost of accommodation I used Airbnb and took the average for a mid-range apartment for one month.
We do have requirements for each apartment such as a safe area, internet, kitchen, cooking utensils, and a short ride to the grocery store.
My wife cooks a lot of our meals to save money on food and for a healthier alternative.
Breakdown of Gap Year Budget for Family of 3
|Expenses||Estimated Costs||Avg Per Month|
|Travel Gear||$800||One time|
|Travel Insurance||$1,000||One Time Fee|
|Entertainment||$3,000||$250 per month|
|Transportation (bus,train, uber, etc.)||$3,000||$250 per month|
|Misc.||$1,200||$100 per month|
Budget for Flights ($7,000)
We will use budget airlines, buses, and trains to save on the cost of transportation.
Budget airlines are a great alternative because they offer low-cost airfare. I know a lot of people do not like them because of all the extra add-on fees, but we travel and light, so we are not bothered.
We do not mind sitting separately and taking turns with the baby if needed. When possible, we will use credit card points for longer flights, just for comfort.
Budget for Accommodation ($7,200)
Staying with locals is a great way to become completely immersed in the culture and learn about the language, customs, and traditions.
When those options are not available; we will use Airbnb. The best way to save money on Airbnb is to stay at least one month, usually at a large discount.
Budget for Food ($3,600)
It is difficult to estimate how much will be spent on food. To save money we plan on cooking a lot of our food instead of going out to eat.
In areas such as Southeast Asia where it is cheaper to eat street food, we do not plan on cooking much. Our food budget will fluctuate, so I set a maximum of $350 per month.
Travel Insurance ($1,000)
I am still researching travel insurance companies to determine the best fit for our family.
We need to have evacuation coverage in the event of an emergency, medical reimbursement, baggage replacement, and trip cancellation coverage.
We have not determined the best company but will post once we decide. It is important always to have travel insurance for the unexpected, it is better to have it and not need it than to need it and not have it.
The best way to save money is to find free things to do with our son. We like to enjoy parks, museums, beaches, hiking, and temples.
There are a lot of things that we enjoy that are free or do not cost much. Tours are great for vacations, but for travel long-term, it is best to explore on your own (safely).
The cost of transportation will vary greatly depending on the country we are in.
For our time in Costa Rica, we will rent a car, which is very expensive once you factor in the cost of insurance.
To offset the expense of the car in Costa Rica we will use public transportation in other countries such as Vietnam, Thailand, and Korea.
Miscellaneous Expenses ($1,200)
Miscellaneous expenses for us are defined as toiletries, medication, laundry, etc.
Emergency Fund ($2,000)
You wouldn’t have great stories to tell if unexpected things did not pop up.
We set aside money for emergencies such as hospital stays, broken equipment, canceled flights, or an unknown mishap we haven’t thought of.
How do we keep track of expenses?
We use a travel expense app to track our spending. The app TravelSpend is great because we can set a budget based on the location. You can add different categories and track spending by the person.
The app converts the local currency into your home currently with a built-in currency converter. The data is great because we can know exactly where our money is going and how we can reduce spending.
Is it cheaper to travel than to stay at home?
After adding all the expenses, it can seem as though we will be spending a lot of money.
To put things into perspective we must compare our travel budget to our everyday expenses.
The table below provides an approximate overview of our monthly expenses.
|Expenses||Estimated Costs||Avg Per Month|
|Utilities (gas, electric, internet, etc.)||$2,400||$200|
|Car (gas, maintenance, insurance, registration)||$2,700||$225|
|Misc. Expenses (cell phone)||$2,820||$235|
|Unnecessary Spending (Target,Walmart,etc.)||$2,400||$200|
By comparison, it is cheaper to travel continuously than to live in San Diego, CA. We could save an average of $14,000 per year by traveling and working remotely.
San Diego has a high cost of living; you can see based on the chart we could pay for our entire family gap year with just the money we pay in rent every month.
I know you may be thinking, why not move to a cheaper place? I have been looking for a job in other cities for over a year and have not been able to find anything in my area of expertise (HR technology).
We have decided not to return to California after bout travels but do not have a specific destination where we would like to settle. Until then we will just enjoy our journey as we travel the world with our son.
Have you traveled long-term and have budgeting tips? Feel free to comment below.