Travel budget: plan it, track it on the road, stay within it

Why a travel budget goes wrong

Travel adds up to serious money, and it’s often planned loosely. UK residents made an estimated 94.6 million visits abroad in 2024 and spent an estimated £78.7 billion on them, according to the Office for National Statistics. That works out at roughly £830 per visit on average.

Most trips don’t go over budget because of one big mistake. They go over through three small ones: a total guessed rather than added up, a trip paid for partly on a credit card and partly from the emergency fund, and spending abroad that nobody tracks until the statement arrives, converted at rates and fees nobody checked. Each section below fixes one of them.

Step 1: estimate the trip line by line

Tom and Ade live in Leeds. They’re planning 11 days (10 nights) in Morocco in August, and they sit down to do the numbers in February.

A few rules that keep an estimate honest:

• Price things, don’t remember them. Look up flights for your actual dates, three places to stay in each town, and what a simple meal costs in a recent forum post or guidebook update.
• Split prepaid costs from on-the-ground costs. Flights, insurance and prepaid rooms are settled before you go. Only the rest (here £440 + £200 + £240 = £880) sets your daily budget.
• Give card fees their own line. The 3% here is a working assumption; replace it with the fee your own card charges (see below).
• Check what’s free before you pay for it. If you’re a UK resident going to the EU, the UK Global Health Insurance Card (GHIC) is free from the NHS. Apply only on the official NHS site; unofficial sites charge a fee. It isn’t a substitute for travel insurance and never covers repatriation.
• The buffer isn’t spending money. It’s for the missed train, the pharmacy, the rainy-day taxi. Whatever’s left comes home to savings.

Step 2: save for it before you go

A trip is a known cost, so it shouldn’t land on a credit card or come out of your emergency fund. The method is a sinking fund, which we explain in detail in our guide to sinking funds: divide what you still need by the months you have left.

Tom and Ade already have £554 put aside. That leaves £1,800 to find, and six paydays from February to July: £1,800 ÷ 6 = £300 a month, £150 each. If that’s too much, the levers are simple: travel a month later (£1,800 ÷ 7 ≈ £257 a month), cut a couple of nights, or trim one specific line.

The same arithmetic works in any currency. In Chicago, Maria wants $1,800 for a week in Mexico City in October and starts in June: four months, $450 a month. If you need to free up the money, our 30 practical ways to save money and how to save money put numbers on the options.

In Binome360, the trip becomes a savings goal with an amount, a date and a progress bar. Each contribution is logged in one sentence. The app doesn’t connect to your bank and never moves money; it keeps the record.

Step 3: set a daily budget for the road

A £2,354 total is no help when you’re choosing where to eat. A daily number is. Take the on-the-ground spending only: £880 ÷ 11 days = £80 a day for the two of them.

Then turn it into the local currency, using the rate your banking app shows before you leave. For this example, assume £1 = 12.5 MAD (a round number for the arithmetic, not a live rate): £80 × 12.5 = 1,000 MAD a day. Thinking in dirhams means you don’t have to convert in your head at every stall.

A daily budget is a pace, not a hard daily cap. A day in the Atlas costs more; a day wandering the medina costs less. Track the running total:

After three days they’ve spent 2,930 MAD against 3,000: 70 MAD ahead. To recalculate, divide what’s left by the days left. The on-the-ground budget is 1,000 × 11 = 11,000 MAD; 11,000 − 2,930 = 8,070 MAD for 8 days, or about 1,009 MAD a day. If the running total goes negative, the new daily figure drops, and you see it on day four, not on the flight home.

Card fees abroad: what to check before you go

Foreign transaction fees. Many cards add a fee when you pay or withdraw in a foreign currency, usually a percentage of the amount. Some cards charge none. The only reliable figure is your own card’s, so look it up:

• In the US, card issuers must show any fee for purchases in a foreign currency or outside the United States in the pricing table on credit card applications and solicitations, under the Truth in Lending rules (Regulation Z, 12 CFR 1026.60). For an existing card, it’s in your cardholder agreement. For prepaid cards, the Consumer Financial Protection Bureau points out that not all of them work outside the US: check the cardholder agreement before you travel.
• In the UK, look for the “non-sterling transaction fee” and any cash fee in your bank’s tariff or your credit card’s summary box.

If you have a choice of cards, the difference adds up. On Tom and Ade’s £880 of local spending, a 3% fee is £26.40; a card with no foreign transaction fee saves all of it.

Dynamic currency conversion (DCC). Abroad, a card terminal or ATM may offer to charge you “in your home currency”. That’s dynamic currency conversion: the merchant’s or ATM operator’s provider sets the exchange rate, instead of your card network, and builds in its own markup. Take a hypothetical meal that would cost the equivalent of $50 at your card network’s rate. If the terminal’s rate is 6% worse, you pay $53, and your bank may still add its own foreign transaction fee on top. French consumer education site La finance pour tous gives a real-world example from Switzerland: 1,000 Swiss francs charged in euros cost €1,131.34, against €1,069.35 when paid in francs, bank fees included. That’s €61.99 on one transaction.

The rule is short: always pay in the local currency. In the EU, whoever offers the conversion at a terminal or ATM must show you, before you confirm, the amount in both currencies and the markup over the European Central Bank’s reference rate. Read the screen. If you weren’t asked and the receipt shows your home currency, raise it before you sign or enter your PIN.

Euro, CFA franc and other quirks. Inside the euro area, EU rules make a payment in euros from one member country to another cost the same as a domestic one, which matters if you hold a euro account. Some currencies are pegged: the West and Central African CFA franc is fixed at 655.957 francs to the euro, per the Banque de France. A peg keeps your budget stable in euro terms, but for a UK or US card it’s still a foreign-currency transaction, fees included.

Taking cash out abroad

ATM withdrawals abroad often carry two charges: a percentage and, on some cards, a flat fee per withdrawal. The percentage is the same whether you withdraw once or ten times. The flat fee is not. With a hypothetical £2 flat fee:

• six withdrawals of 500 MAD cost 6 × £2 = £12 in flat fees;
• two withdrawals of 1,500 MAD cost 2 × £2 = £4.

So fewer, larger withdrawals, but not so large that you carry the whole trip in your pocket: it’s a trade-off between fees and safety. The ATM operator may add its own charge, so read the screen before you confirm, and decline any offer to convert the withdrawal into pounds or dollars. UK government guidance suggests taking more than one means of payment (cash, prepaid travel card, debit card, credit card) and checking which works out cheapest.

For your budget, the rule from our guide to tracking cash spending still applies: a withdrawal isn’t spending. What you buy with the cash is.

Tracking spending in several currencies

Travel tracking usually fails the same way: you’ll do it tonight, then tomorrow, then when you get home. Three rules make it stick:

1. Log it when you pay, in the currency you paid. “120 dirhams, mint tea and pastries” is enough. Converting each item to pounds wastes time and gives a wrong number anyway, because the real rate and fees only show up on your statement.
2. Keep one cash account per currency. Dirhams in your pocket aren’t pounds in your wallet at home. Record what you start with, add each withdrawal, and check the total against your wallet every evening.
3. Convert totals, not lines. When you’re back, add up each currency and apply the rate from your statement, fees included. That gives you the true cost to compare with your original budget.

In Binome360, you type or say the expense the way it comes to you, in any currency. A photo of a receipt proposes the amount and category (here’s how to photograph a receipt so it’s readable). Cash is typed in by hand, on a cash account you keep yourself. Totals are shown per currency; the app doesn’t convert them for you and doesn’t connect to any bank. Nothing is saved until you confirm.

Group trips add a second question: who paid for what? Four friends from New York spending a week in Lisbon can share one assistant in Binome360. Each of them logs expenses from their own phone, in euros or dollars, and everyone sees the same history. No more rebuilding the dinners, the Ubers and the tram passes from memory on the last night. If you’re travelling as a couple who already share money, our couples budget guide helps settle who pays for what before you leave.

Frequently asked questions

How do I calculate a daily travel budget?

Add up everything you’ll pay for on the spot (rooms not paid in advance, food, local transport, activities) and divide by the number of days. Leave out flights and insurance, which are paid before you go. Convert the result to the local currency, then recalculate as you travel: money left ÷ days left.

Should I pay in local currency or my home currency abroad?

Local currency. When a terminal offers pounds or dollars, the exchange rate is set by the merchant’s provider and usually includes a markup, and your own bank may still charge its foreign transaction fee on top. In La finance pour tous’s Swiss example, the difference was almost €62 on 1,000 francs.

How much cash should I take on a trip?

There’s no universal figure. It depends on how much the country runs on cash and what your card charges for withdrawals. A sensible approach: enough for the first day or two (airport transport, first meals), then a small number of mid-sized withdrawals. Cash can be lost or stolen, and cards can be blocked, so carry both.

Is a travel budget the same as a sinking fund?

Saving for the trip is a sinking fund: a set amount each month towards a known cost. The travel budget goes further. It also covers the daily budget and the tracking while you’re away, where the sinking fund stops.

What if I’m over budget halfway through the trip?

Recalculate the daily budget with what’s left. If the new figure is too low, pick one line to cut (one excursion fewer, simpler meals) rather than trimming everything. Use the buffer before you touch your emergency fund.

In short

A travel budget comes down to three numbers: the line-by-line total, the monthly amount that pays for it, and the daily budget on the road, in the local currency. Abroad, pay in local currency and group your cash withdrawals. First step: open a spreadsheet, list every line of your next trip with a real price next to it, and divide what you still need by the months until you leave.

Sources

• Office for National Statistics, “Travel trends: 2024”, released 26 August 2025: ons.gov.uk.
• Consumer Financial Protection Bureau, Regulation Z, 12 CFR 1026.60 (credit and charge card applications and solicitations) and Official Interpretation, comment 60(b)(4): consumerfinance.gov.
• Consumer Financial Protection Bureau, “Can I use my prepaid card outside of the U.S.?”: consumerfinance.gov.
• NHS Business Services Authority, “Get healthcare cover for travelling abroad”: nhsbsa.nhs.uk.
• nidirect (Northern Ireland government), “Advice for travelling abroad”: nidirect.gov.uk.
• Regulation (EU) 2021/1230 of the European Parliament and of the Council of 14 July 2021 on cross-border payments in the Union (codification), Articles 3 and 4: eur-lex.europa.eu.
• La finance pour tous (IEFP), « Paiement à l’étranger : en devise ou en euro ? », updated 16 June 2025: lafinancepourtous.com.
• Banque de France, “A 21st member of the euro area for 2026: Bulgaria”, 2025: banque-france.fr.
• Banque de France, “Africa-France partnerships” (CFA franc peg): banque-france.fr.

Also available in Français.