One of the most common questions I am asked is “how did you afford such a trip?! Are you rich??”
Here is the simple answer:
I saved money by traveling.
In other words, it would have cost me a lot more to stay and live in Chicago than to travel around the world. When you take into account all my monthly expenditures:
Home: Mortgage + fees + taxes + insurance + utilities (cable, internet, phone, gas, electric, cell phone) +
Food/Home Goods +
Entertainment (dining out, movies, concerts, theater) +
Transport (Car: fuel, insurance, maintenance, parking, permits), public transport costs +
Miscellaneous (gym membership, gifts, random weddings, parties, clothing, medical, etc.)
Plus, in a normal year just living at home, random costs often come up as well — car needs repairing, unexpected furnace replacement, etc. — or even just trips to Target where I never could get out for less than one hundred bucks.
While traveling I mostly just had to worry about transport, lodging, and food.
I did not need to maintain a car.
I did not need to stock up on all the things you ‘need’ when you have a home: from toilet paper to vacuum cleaners to sheets to towels to clothes for every season to furniture to shower curtains and on and on.
I did not receive any bills except a credit card bill and a monthly storage bill.
I canceled my cell phone and all my other utilities.
I lived out of a bag and life was easy. Sometimes variety is the spice of life, but oftentimes, as Mies van der Rohe said it best, less is more.
No stuff = No worries.
So, back to that question. On average, I spent about $2000 each month depending on where I was in the world. In Asia and Central America you can cut that in half. In Australia and Europe, things were pricier, but then I started Couchsurfing more, so actually my costs fell. In London, I stayed for a month and never paid for lodging…so for all the talk of it being such an expensive city, that didn’t really affect me at all. I didn’t dine in fancy restaurants; I ate at my hosts or friends’ houses a lot, and enjoyed the free museums.
A few times on my trip my friend Mark met me somewhere in the world. So when we were in expensive Dubai, we were splitting most costs in half, which also made it affordable for me.
I splurged on occasion and stayed in a nicer hotel instead of a hostel or someone’s home. I also splurged on a few tours, like the once in a lifetime week-long boat-tour of the Galapagos Islands. That shot my totals up for Ecuador, which could have been a ‘cheap’ country. But for me, it was worth it. Then, a country like Vietnam or Cambodia, evened it all out because it is so inexpensive. Lunch can be a huge plate of noodles for $2 and a beer for 50 cents. Yes, 50 cents.
Many people’s first assumption is that traveling for an extended period of time must be very expensive. But this is just not so. I mean it can be if the words ‘budget’ or ‘cheap’ are not part of your vocabulary. The most expensive part of your trip will be transportation, but even then…it’s still cheaper than you assume because you are only booking one way tickets and your dates are more flexible so you can find amazingly good deals. My first 15 months around the world cost me less than $5000 in airfare — and that is with stops in about twenty cities in nearly every continent — thanks to STA Travel and great internet deals on budget airlines in Asia (Air Asia) and Europe (Wizz Air, Ryan Air, Air Berlin…nearly every country has a slew of its own budget airlines that fly all over Europe). That’s pretty great when you consider just one round trip ticket to Australia can be more than $2000.
Now, costs can certainly add up if you are staying at four and five star hotels and traveling in first class. It also can be very affordable if you stay in hostels and small, independent hotels and get all the discounts you can. Most hostels average around $20 per night depending on the country you are in (in Costa Rica I stayed at one that was $6 a night for a single room and in Australia some were $30 a bed). At the average rate it only costs me $600 a month for lodging. That’s way less than the rent or a mortgage payment in Chicago. And that’s not even taking into account all the nights I used couchsurfing.com – the amazing worldwide hospitality network in which like-minded locals open up their homes to you free of charge as part of a larger cultural exchange. You can read more about Couchsurfing in my original post HERE.
But what about before you left? You had to have some savings to feel secure in taking such a trip.
Good question. Well, first, I worked my ass off full time in television production for about 13 years. I have always been a saver and not much of a [hey] big spender so I put a lot of what I earned into the piggy bank. I have never accrued any credit card balances or debt. I don’t buy new shiny things just to have them or keep up with the Joneses or Garcias. For example: I owned the same used Honda Prelude my entire adult life…until I sold it when I left to travel.
I’ve managed to avoid the other American dream—to be a sucker for marketing and feel the need to run out and buy the latest iPhone, Plasma screen TV, DVD or even the latest latte. I am simply not much of a shopper…especially when it comes to clothes and shoes. I like cute stuff, but don’t need name brands and don’t need a million pairs of shoes.
I made some smart real estate investments and owned two condos in Chicago. After seven good years of appreciation and lucky timing, I sold the first one to give me the ‘security’ for my first trip and since traveling on a budget is cheaper than living day to day in the United States…I still have a while to go before I spend all my profits, let alone dip into my savings.
So, don’t let anyone scare you. Long term travel is totally doable and affordable. The fact that it cost me less to travel than to stay at home is a testament to that. And whatever savings I did spend, I certainly don’t miss at all.
If you have any specific questions, please feel free to leave a comment.
It’s Just Like Riding a Bike
Thank you for putting everything in perspective. The thought of continuing to pay nearly $1500 a month in rent when we could be traveling the world really doesn't make sense.
The part about working your ass off before the first trip is important. That's when I met you and you did work your ass off to get to the point where you could travel your ass off. No half measures with you kiddo!
Fantastic post! I kinda wondered myself but knew you worked in a tough industry and therefore knew you worked you butt off. This all makes total sense now BUT this type of travel is attainable to anyone who wants it. You simply want to have it in order to achieve it….much like most things in life.
Thanks for sharing – and debunking the common thought that to travel around the world you have to be rich! I know I spent less traveling than I did living in NYC!
My boyfriend and I just started the around the world travels ourself. Being nomadic by nature we find that this life is more satisfying and much cheaper than living in LA where we spent the past 9 months. We have just begun our around the world trip, but we know it is going to be more enriching than money can buy.
Also having a laptop business doesn't hurt. 🙂
Thanks for sharing. I will be following your blog.
I like your post and would like to invite you to our website, dedicated to wine, food and travel. You will find plenty of information about great places to visit all over the world. Welcome!
I just returned from my first overseas trip to SE Asia. What was only suppose to be a 3 month trip turned into a nearly a 10 month adventure. My friends always ask how was that possible, thinking that I am secretly rich. This always makes me smile bc I am far from it. Your article is dead on. Now that I have the travel bug and realized that experiencing the world brings me much more happiness than anything I could buy at some department store. Thank you so much for your well written post. I am beginning to plan my next big adventure.
It's all a matter of priority. We have a 10 year old car (dying — but it does its job getting us to the grocery store every weekend) and we keep our stuff to minimum so we can move to where the jobs are (and thus able to only have one car between the two of us). It takes conscious effort to 'design' that kind of lifestyle but knowing where our priorities lie really has helped us sticking to our plan.
LL, you are simply and amazing inspiration. You are responsible,dedicated and do maintain a very simple lifestyle when you keep away from the phone! I understand why-NOW!
Of all the posts i have been following you on, this one is my favorite.I will mail you for some tips definitely, they might help me in racing ahead with my photography in the future.
I have travelled extensively for long periods of time and know this to be true: it is cheaper than living at home. In fact, it makes me wonder why I live in an expensive country and expensive city at all, with the cost of living so much lower elsewhere. The biggest challenge is to make the break and just GO.
My motto is to live like you are poor while working so you can enjoy it traveling! You must have been one of the lucky ones to sell your house before the market took a dump. I wasn’t so lucky, but you live and learn!
You forgot one thing. That while traveling overseas you can also make a little bit of money teaching private English lessons. The pay is high for such a easy thing as teaching kids how to pronunciation and word association. A little internet work can yield these results and even pay your expenses while you are living in hostels traveling around.
Did you ever get approached in your travels to do this?
Joel: Yep taught English here and there. This post above is mostly about having money BEFORE you leave. I wrote about working around the world here: https://www.llworldtour.com/2009/08/12/working-aro…
🙂
I have a question. I'm planning on saving $36,000 for a RTW one year trip to 24 destinations. I was wondering if this was enough? I plan on staying in hostels and doing low-budget the entire time.
I think the biggest obstacle for me is debt. I accrued student debt earning my Master's and I'm not sure how I would go 1 year without making payments. Any advice would be appreciated. Thanks!
Hi guest (nice name!)-
Depending how you travel…that can be enough. I definitely spent less than that in my first 12 months including airfare. The slower you go (not flying to a new place ever few days or week), the more you stretch your budget. Also look into using couchsurfing as it's cheaper than hostels being that it's free! Traveling can be much cheaper than many realize. Hopefully the tips on this post and in my 'travel tips' section can help you. Good luck!
Thanks for this Lisa! I love saving money. You could call it a hobby of mine. I actually put together a very detailed spreadsheet that I use that tracks everything I spent in every category down to the penny and even does an actual vs budget comparison with variance. I guess my accounting degree from USC kicked in there! 🙂
I've created a simple version of this spreadsheet on my website that people can use. Saving money is always a good thing – whether it's for travel or anything else. You just need to make a little effort. I find having a budget and tracking expenses really opens your eyes to where your money is being spent.
Thanks Jeremy! I'm glad this money post helped you some. When I started my RTW trip, I really didn't follow a specific budget except to "save" and be "frugal." So far it's worked out pretty well!
but what about retirement?
I travel a lot also, but I also work a lot.
3 months out of the year I am traveling somewhere… but 9 months out of the year I have to work, to secure my retirement plan. Been securing money for retirement since I was 17, it does cost me less on the road than when I am at home… but only if you look at it from a temporary point of view. Please talk about your plans of retirement along with your pleasures of traveling.
Thanks for chiming in Frank. I have had a retirement plan from my employer-programs since I was 20. I still have my IRA although since I quit working for others, I have not contributed to it for about 5 years, but I have not taken money out of it. It is still accruing interest for me though. Besdies that I have other money I have saved from working 15 years in television that is also invested and ‘working for me.’ Otherwise, I don’t want to save all my money now until I’m old. I prefer to live life now and enjoy the things I like to do, while still being frugal on things i don’t need. I am really trying to live now and not later. Life is now!
you won’t keep up with inflation if you don’t keep contributing at least a little bit every month though. Again, something to think about for a sustainable future as well.
-Maria Alexandra
it’s more about MAINTAINING a travel lifestyle.
While back at home you can maintain the lifestyle with a job, while traveling it’s more difficult–or at least less people know how to do it in a sustainable way.
Unless you find steady freelance gigs or work your way around the world, the savings will end eventually. Something to think about and definitely tell future wanderers as well 😉
-Maria Alexandra