The hardest reality to accept when you are considering a trip like ours is that “You can afford this. You really can.” Our ability to save was augmented by the circumstances of our life: we had no children, no mortgage, no car payment, great jobs, and no debt beyond student loans. And yet even with all of these factors working in our favor, we still didn’t think we could put the money together as quickly as we did. In the end, we used a lot of the same techniques you would use to save for any significant expense in your life, be it a new home, a new car, or a college education.
Once we accepted that we could, in fact, save a bunch of money, we needed to determine how much we actually needed for a year of travel. We spent a few weeks scouring the internet (see Blogs we Love), reading about the costs of food, lodging, and travel in at least 100 countries, and sitting at the bookstore reading books like The Rough Guide to First-Time Around the World. Based on our research, we determined that by focusing on countries in Asia, Africa, and Eastern Europe, we could keep costs down and travel on a reasonable budget of $40/day per person or about $85/day total. This meant having about $31,000 in the bank when we stepped on the first plane. That total doesn’t include things we bought before leaving (vaccinations, insurance, supplies, etc.), flights (we used frequent flier miles) or student loans (which we saved and budgeted for separately).
Adam’s shameful addiction
With a target of $31k set, we went about saving. Most of what we did is standard: we cut back on our expenses by making nearly all of our meals at home, stepped our cable/internet package down a notch, direct-deposited part of our paychecks directly into savings, and sold everything we didn’t need. Little things ended up adding up to hundreds of dollars – for example, Adam went from eating pre-packaged instant oatmeal for breakfast to buying oats and brown sugar in bulk at the grocery store and making his own. Since he is a freak who eats 4 packets of instant oatmeal at a time (3 boxes a week!), that money really piled up.
Some of what we did was less standard, but we think they were good ideas that are worth sharing. We…
- moved into smaller house that cost less money (we were renters, we do not own a home).
- took advantage of offers for cash, for example “open a Chase Checking account and get $200”.
- signed up with several market research companies and participated in paid focus groups for them.
- earned “gas points” at the grocery store and then were diligent about using them at the right gas stations to get gas discounts.
- worked like mad to save up frequent flier miles to pay for flights (see FlyerTalk.com for more than you ever wanted to know).
Better than a Dominos pizza? You decide.
The day-to-day was sometimes difficult. No matter what you’re saving for, it is hard to establish a habit of thinking about your goals before you reach for your wallet. We made it easier by thinking of items we were tempted to buy in terms of what that money would buy us on the trip. For example: “I really want to order pizza. But that $25 is two hotel nights in Thailand…” This kind of comparison made it easier to resist temptation.
When you rigorously examine your day-to-day spending, take some common-sense savings steps, and then go the extra mile to pull in or save every extra dollar, it’s only a matter of time before you have the money you need. Tracking your savings can make the time seem to pass more quickly. Adam’s a huge dork and built an Excel spreadsheet to determine how long it would be before we would have the requisite money. Updating the spreadsheet every couple weeks provided instant feedback on how well we were doing. If we did well over those weeks, our projected departure date would move closer. If we didn’t stick to the plan, our departure date wouldn’t budge – or worse – would move farther away. But sure enough, after several months of hard work and attention to our budget, we made it happen!