Financial Planning

One of the most common questions we got when telling people of our trip was “How much does the trip cost? How do you guys afford it?” There are a few different ways to do budgeting; we decided to use an all-inclusive rough estimation method.

Budgeting for a family of four:

  • Expensive international cities: $450/day

  • Europe, Australia & New Zealand: $350-400/day depending on country

  • Southeast Asia: $250/day plus airfare

  • Egypt, India and other under-developed countries: Very expensive with all-inclusive packages

Overall, we found that we could travel the world for a year for $130,000 - $150,000, depending on the number of destinations we want to include. This covers our travel style with above-average accommodations and modest food choices, with only 1-2 meals at nice/fancy restaurants a week. Of course, the more places we travel to, the more we spend on airfare.

Guidelines and assumptions:

  • Adjust your travel style by location. In Europe, we stayed mostly in vacation rentals and cooked as much as possible. Eating out was expensive, and grocery stores are easy to navigate. In SE Asia and Africa, however, we appreciated the quality standards of hotels and cheaper food prices make eating out daily a feasible option.

  • Keep accommodation expenses between $150-$200 per night. We found this to be the sweet spot. We stayed at several places for around $100, but ended up regretting about half of them.

  • Transportation expenses vary by geography. Do some research ahead of time to determine the optimal method of transportation. In Europe, for example, you don’t need a car in major cities like London, France and Rome, but having a car is great outside of these cities. Rent a car only when you need it. In Croatia, for example, we flew into Dubrovnik and relied solely on Uber there, then rented a car for the rest of our time in Croatia.

  • Account for transportation expenses. The more locations you try to cover, the more you spend on transportation cost. This is especially true in Southeast Asia, where food and accommodations are cheap, airfare is expensive, and flying is often the only transportation option. For Europe, where we stayed for three months, we included transportation expense as part of our daily budget amount. For Asia, this becomes more problematic, as airfare accounts for about a third of our total expenses when we flew from destination to destination each week.

  • Hotel rooms for four are hard to find. Rooms with two queen-size beds are common in the US, but they are surprisingly difficult to find in Europe and Asia. We preferred vacation rentals with two bedrooms, but given hotels’ high prices, we prefer to just stay in one room. Many of our preferred hotels didn’t have rooms for four, be sure to verify this when choosing hotels.

  • Vacation rentals or hotel rooms? We chose to do home schooling throughout the year, which means we aimed to spend two full days a week doing home schooling. This allows for “rest days” throughout the trip and allows us to keep up with homeschooling curriculum. This also means we spend quite a bit of time in the accommodation. As such, we appreciated the extra space of vacation rentals. Getting a 2-bedroom vacation rental also allows for more privacy and prevents us from getting in each other’s way while homeschooling and catching up on work. Overall, we stayed at mostly vacation rentals in Europe and Taiwan, hotels in SE Asia, and a mixture of vacation rentals and hotels (and motorhome) in Australia and New Zealand. We would recommend doing something similar, but it does boil down to personal preference.

How to Pay for the Trip?

There is no way to provide a generic answer on this, of course. For us, many years of investing in real estate investments provided decent passive income that helped pay for the trip. Some travelers we met sold their houses to cut the hefty mortgage expense; this wasn’t an option for us but could be viable for others. One thing we found to be very helpful — Use an expense-tracking app and track every single dollar you spend during the trip. We did this throughout our entire trip, breaking up expense tracking by country, creating one “expense report” per country, and this was a great way for us to track whether we’re over or under budget for each country and for the entire trip. We used the “Expensify” app, but there are plenty of app choices out there.