Planning a Round-the-World (RTW) Trip For Under $10,000

The following is a guest post from reader Chris, who shares a quick and dirty (and cost-conscious) examination of Round-the-World Travel. He writes about about making a life of long-term travel and other related topics at ChrisCarruth.com.

$10,000 goes a long way. That’s a healthy drop in the retirement bucket, a sizable boost to any portfolio, a new(er) car or, as I’m about to advocate, an adventure of spirit and culture and affirmation that most never embark upon.

Would you believe me if I told you that you could travel the world for $10,000? Hopefully, by the end of reading this you’ll see the opportunity for what it is. Of course we aren’t talking about stopping at the nearly 250 UN recognized nations, but rather circumnavigating the globe while stopping at a selection of countries and cities. Your time frame, your itinerary, your budget (and your sensibilities) will set the limits of your travels, so keep them in mind at all times.

Being readers of MyMoneyBlog.com, I think it’s safe to assume that you’re all fairly versed in saving methodologies and tips and tricks and are in, at least, a decent financial state. If you’re a new reader or simply don’t have that kind of scratch lying around, I didn’t leave you out. I’ve left some time honored travelers tips at the bottom to both save money for your travels and to pinch pennies while on the road. General rules of this study:

  • I am traveling solo.
  • I have gear and vaccinations.
  • I have $10,000.
  • I will travel for 3 months – 1 week in the US. 5 weeks in Europe and 6 weeks in Asia.

Consideration #1 – Airfare

Costs: $1,700
Remaining budget: $8,300

Airfare these days is not only the most economical choice, but also the least logistically imposing method of traversing the globe. There are two main schools of thought when it comes to RTW airfare – have it your way or go prepackaged. Customized itineraries allow for greater flexibility of schedule, freedom of destination and directional independence, while “pre-packaged” RTW tickets typically want you flying East-to-West (or vice-verse, no hopping back and forth), have a handful of stops and must be used within a certain date (usually within one year from purchase).

My focus on traveling will be South East Asia and Western Europe in a west-to-east route. I’ve opted for an itinerary from Boots’n’all Travel, who partners with the Airtreks to bring all this in at $1299 (as of September 2010, see current RTW specials here) . There are always some hidden fees, so let’s buffer that up to a straight $1500.

Flight itinerary – SE Asia & Europe Budget Ticket: San Francisco or Los Angeles – Manila – Borneo (Kota Kinabalu) – Singapore – Angkor Wat (Siem Reap) – surface – Saigon (Ho Chi Minh City – Bangkok – surface – Kuala Lumpur – London – Amsterdam – surface – Paris – San Francisco or Los Angeles from US$1299

Note: This sample itinerary is good through September 30th. Each month Boots’n’all offers different routes, but the prices, and locations, generally stay the same.

In the interest of creating as realistic a scenario as is reasonable, I’ll dish up the fact that I don’t live in San Fran or L.A. I’m a Colorado Springs resident…a quick check on Kayak.com shows that round-trip airfare from my home to the Bay Area and back runs less than $200. Done (and subtracted from our budget).

On a side note, if you’re concerned about the environment impacts of air-travel, you’ll be happy that the sustainability movement has more than a foothold in our modern travel climate. Carbon offsetting is an option as are bio-fueled jets (not commonly available…). Of course, these will up your costs and for the sake of staying under budget I’ve left them out.

Consideration #2 – Lodging

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Lonely Planet Offers Free iPhone Apps To Travelers

In response to the disruption caused by a certain Icelandic volcano, Lonely Planet has made their iPhone apps for 13 European cities free until April 22nd. These usually cost $15.99 each, and seemed to work fine on my iPod Touch. From their blog:

‘Travellers stuck in unfamiliar places need access to practical information as well as suggestions on what to do whilst stranded’, said Tom Hall, Lonely Planet Travel Editor. ‘That’s why we’re giving away iPhone city guides to major affected destinations.’

I think it’s a nice gesture on their part and also good PR. Heck, I didn’t even know Lonely Planet offered apps until today. Should make for some neat reading. Here are direct iTunes links to the included cities:

Interview: A Couple Spends A Year In Asia For $9/Day Each

This is a interview/guest post with blog reader Ariel Hoffman, who recently spent a year traveling around Asia with his girlfriend Michal with a combined budget of only $10,000 – and managed to come back with $3,500 of it! I love to read nonfiction travel essays, so not only are there some great frugal travel tips below, it was also very exciting to read about their adventures. Thanks again for sharing, Ariel!

What was your inspiration to go on this adventure?
In Israel, it is mandatory to serve in the armed forces for at least 3 years. After that you just want to get away, and Asia is the perfect destination for someone who’s just saved up 3 years worth of the army’s 100$-a-month salary. Also, Israel’s a pretty small country, so there isn’t much domestic travel to be had like there is in the US.

The itinerary my girlfriend (Michal) and I came up with was mostly about avoiding the rainy season, and minimizing air travel. Air travel is expensive and boring, and you try to avoid it if you have a lot of time to spend.

How did you come up with your budget? Did it end up costing more or less than you thought?
We sat down and did some serious homework, mostly on websites like lonelyplanet.com and their forums. The budget they offered sounded ridiculously low, so we nearly doubled everything we read about, and came up with a rough estimate of about 10,000$ for the two of us, for the entire year.

What we realized, however, is that not only were the estimates online pretty accurate, but also that two people don’t spend exactly twice as much as one – lots of things are shared (such as meals, transportation, hotel rooms etc.) and so it’s more like budgeting for a person and a half rather than two.
We were very pleasantly surprised when we came back home to count our remaining traveler’s cheques and see we still have about 3,500$ left over for next time!

How did you fund it? Did you save up the cash upfront, borrow some money, work while on the trip, or some other combination?
In preparation for our trip, we both took on extra work and saved up every Shekel we made. It took us about 5 months. Once we reached our goal of 10,000$, we exchanged all our cash into traveler’s cheques – a great way to keep your money both liquid and safe when abroad. Luckily for us, the exchange rates were in our favor the whole time, which gave our savings an extra 2%-5% throughout the journey.

Walk us through a typical day on your Year in Asia trip.
Most days would begin with trying to find breakfast – not always an easy task. Most Asian countries do not serve what we would consider breakfast, especially my vegetarian Michal. Although chicken porridge and spicy rice is very nice, it’s not everyone’s idea of the right way to start your day. After eating some novel type of cookie in spiced tea, we would set off to whatever National Monument/UNESCO World Heritage Site/Giant Temple/Yearly Festival was in the town on that day. After a day’s tour of the attraction we would start hunting for a suitable lunch, which meant looking around for a street stall with a good crowd, or a local restaurant with a queue. Nothing says fresh like a long line of customers, and Asian vendors normally close their stalls every day when they’ve exhausted all their stock, so food is never kept overnight and doesn’t have time to spoil. Another plus is that the food is not made of pre-cut ingredients, which makes preparation slower, but at least you see exactly what you’re getting so there are no surprises.

Evening was normally a time for sitting on the beach, going to some performance or sitting in some tea-shop with friends. For a while we had a small kitchen in our room, so I would cook dinner for us while Michal practiced yoga. In China we bought a Wii, and at night we’d plug it in and invite friends over for kart racing – it’s OK to enjoy modern fun even when on the road!
We spent a lot of time on trains and buses, getting from A to B. Sometimes as long as 27 hours! Israel’s longest train ride is only 4 hours long.

What are some basic money-saving tips you might offer us readers?
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Budget Long-Term Travel: Explore Longer For Less

The following is a guest post from Matt from NomadicMatt, who as you might guess has a passion for travel and doesn’t like to stay in one place for too long. He wrote this while running around Spain! If you like what you see, I encourage you to check out his site for his travel blog and other travel tips.

One thing that always irks me about my fellow countrymen is the huge perception that travel is expensive. With only two weeks away a year, I can see why a lot of people would want to splash out on an expensive holiday. There’s nothing wrong with that. But a lot of people spend more money and get less value. They spend money on things the travel industry tells them they need but could find much cheaper. I’ve been traveling around the world for three years and whenever, I have friends come visit me in places, they are amazed at how little they spend compared to what they thought they would. I don’t penny pinch but I don’t spend money stupidly.

Take for example my trip to Thailand with a co-worker. Flights to Thailand can run anywhere between 800 and 1200 dollars for an economy class ticket. You can only hope to get on the lower end and sites like Momondo and Mobissimo are good at that. Additionally, you can check out my page on how to find cheap flights. My friend asked me how it would cost her for the two and half weeks we were going to be there. Should she bring 1,000 dollars? 1,500? Thinking about what I had planned for us, I told her $700 should be enough, unless she wanted to shop – then she should bring a few hundred more. She didn’t believe me but I was right. Here’s the break down:

  • Accommodation – Typical double bed room with shower, fan, or a/c. Nothing fancy but not super dirt, “I see a cockroach” cheap either. It cost us 20 dollars a night, which was split by two people.
  • Transportation – We took the local buses and trains around the country. They are very cheap with a train costing only a few hundred baht. (It’s 35 baht to one dollar). Overall, we spent $50 dollars on transport.
  • Food – Having lived in Thailand, I know the best food there is on the streets, which is also the cheapest food. A meal is about 30 baht. We also ate a lot of seafood on the islands which is about 300 baht a meal. Throw in a few sushi and Italian dinners at about 800 baht each and in total for 2 1/2 weeks we spent about 3,500 baht on food, which is $100 dollars.
  • Alcohol – We like to party so this was a bit of a budget buster. We easily spent $100 USD on going to clubs and beach parties.
  • Tours – We took one tour through the national park that cost us 1,500 baht for two days. The guides spoke perfect English and new things about the area that amazing. When we went to the beach, we did a snorkel tour for 500 baht.
  • Other sights – We spent about $10 dollars on the palace and temples in Bangkok.

So for 18 days we spent about $560 dollars per person, or about $31 a day, without skimping on anything, eating the local food, taking a few tours, and doing nothing really cheap. For 18 days, that is not a lot of money.

Thailand is a cheap country so I’m always amazed when people walk away spending lots of money. A typical two week tour to Thailand runs about $1,000 dollars from Gap Adventures, which actually specializes in inexpensive tours. We spent less in longer. (Editor’s note: Or you could stay an entire month for the same price of $1,000.)

Moreover, when most people travel to Thailand they stay at the big international hotels like the Marriott or the Sheraton, fly everywhere, and stay at luxury beach bungalows for 2,000 baht a night. When they eat, they eat out at fancy places. Relative to their home country, whether the U.S. or Europe, this may seem like a bargain (Wow! I just got a beach bungalow for 70 dollars a night!) but compared to how living locally is a third of the price, you aren’t getting good value for your money.

If luxury is what you want, go for it but if you want more value for your money, live more like a local, take the local transportation, and stay in middle of the road places. You’ll save a lot of money but also get to know the pulse of the location more. There’s nothing wrong with spending money but I find not getting the most out of the money you spend a waste.

(Photo credit: NomadicMatt)

Finding The Actual Hotel Name On Hotwire.com Before Purchase

This is a follow-up to my 5-Step Guide to Finding The Lowest Rate For Hotel Rooms, which includes tips on using “opaque” sites like Hotwire.com and Priceline.com to save on hotel rooms.

Specifically, I’ll show you how to greatly improve your guess as to which hotel you’re actually bidding on Hotwire.com before pulling out your credit card. This was initially inspired by a helpful comment by reader Nasty N8, but I expanded and altered his advice a bit.

Finding The Hidden Hotel

When you run a search for hotels on Hotwire, you only get the price, star rating, and the general neighborhood. For example, here’s a search result for hotels near the Orlando airport (MCO) on 12/20/09.

Hotwire Participating Hotels
I see that I can get a 4-star hotel near MCO for $56+taxes. But which one? How do I know if it is any good? Using the Hotwire Hotel List for Florida at BetterBidding.com, I scroll down to the Orlando MCO section and see two listings: Hyatt Regency Orlando Airport and Renaissance Orlando Hotel Airport (Marriott). Again, this list is not 100% accurate, but it does provide a shortcut possibility and also another data point for later (see scenic route).

TripAdvisor Clues
I click on the red box “Continue” to see the total with taxes per night ($69.45), and also learn more details about the actual hotel. If I scroll down I see some information from TripAdvisor.com:

With this information, I can usually reverse engineer the specific hotel from the TripAdvisor (TA) site. There are three points of interest here:

  1. Tripadvisor Traveler Rating (Out of 5). Based on customer reviews, this is an average rating of quality. Sometimes they won’t match up perfectly (i.e. TA will show 3.5, but Hotwire will round up to 4), but most of the time they will.
  2. Number of reviews. This will not be exact, but instead be rounded off to the nearest 20. So if TA has 35 reviews, then Hotwire will say 20+. If TA has 41, then Hotwire will show 40+.
  3. Date of last review. Simply look at the date of the first review you see on TA, and compare with this date.

Mix-n-Match
Let’s go back to the initial hotel list. Here are the Tripadvisor pages for the Hyatt Regency (4.5 dots, 163 reviews, last on Aug 2009) and the Renaissance Hotel (4 dots, 57 reviews, last on Aug 2009). Remember, 57 is the same as 40+.

We see here that the most likely hotel is the Renaissance Orlando Hotel, with all factors matching. At Expedia.com, this hotel would have cost $112 per night with taxes on the exact same day. By doing a little legwork, you could secure a savings of over $42 per night (38%).

The Scenic Route
If you did not find a match, then the hotel may not be updated on the list yet. Here, you’ll have to run a search on Tripadvisor. Use the “Hotels” tab and act as if you want to book a hotel, using your travel dates and everything. Do not just use the search box. Now, the left sidebar will have a ton of options to narrow down your search results. Again, use your region, your Tripadvisor rating, and also the star class rating. (Note: The hotel class “star” rating by Tripadvisor will sometimes vary from the ratings from Hotwire, so you might allow one star difference either way.)

Here is a nice screenshot that shows how I narrowed it down to 6 hotels. As you can see, the only hotel left that matches the Tripadvisor stats is… again the Renaissance Orlando Hotel!

You can also do this down the line with all the different Hotwire search results. Now that you can figure out the actual hotels, you might feel that $50 a night at a 3-star Holiday Inn is better than $100 at at 4-star Hyatt. Happy hotel hunting!

Free US Airways Silver Preferred Status For 90 Days

US Airways is running a promotion where you can try out their Silver Preferred “Elite” status for 90 days. Normally, you’d have to pay $200 or fly 25,000 Preferred-qualifying miles (or 30 qualifying segments) within a calendar year. You must register by August 31st.

The perks of Silver Preferred include:

  • Priority check-in, express security lines, and early boarding.
  • First and second checked bag (free of charge)
  • Free upgrades to first-class when available.
  • 25% bonus miles flown on US Airways

A pretty good deal if you are making any US Airways flights in the next 90 days. I’m not sure how they count the 90 days, it may be a good idea to register near the end of the promotion if you’re traveling during the winter holidays.

Try Preferred status on for size. See how you like it. At the end of your 90-day trial, you may want to keep it! Once you register, you’ll be Preferred within 14 days. [...] Just register between May 15 and August 31, 2009. Then, check your Dividend Miles profile to make sure we have your contact information so we can send you an email with your new status.

5-Step Guide to Finding The Lowest Rate For Hotel Rooms

Whenever I’m not traveling on the company dime, I usually run through a checklist to find the lowest price on hotel stays. Let’s say you’re like me and need to find a room in New York City for a few nights, checking in August 30th. I’d like to stay somewhere near Times Square in Manhattan, close to all the sights and action. I’m also leaning towards something reliable and not bargain basement – this is NYC and I don’t want a Hotel Carter experience involving bed bugs, roaches, and urine smells. (Note this for later: At their website, they charge $99 a night.)

1. Check the hotel’s direct website.
If you have some favorite chains due to corporate agreements or loyalty points, then this narrows your search down and you can try and check directly with their website. For example, there is Hilton.com, IHG.com, and StarwoodHotels.com for Sheraton/Westin/W Hotels. Here are some quotes (all prices not including taxes):

Hilton Times Square, $195
Hilton New York, $169
W NY Times Square, $272
Westin NY Times Square, $232
Sheraton Manhattan Times Square, $189
Four Points Midtown, $157

This gives me a benchmark to work from. Another benefit here is that they usually have some form of “Best Rate Guarantee”. Starwood will beat a competing vendor’s price by either 10% or give you 2,000 Starpoints.

2. Try to use loyalty program points.
An extension of the above, at times it is better to redeem your points, or some combination of cash and points. For example, the Westin NY Times Square would only cost 12,000 Starpoints per night, or 48,000 points for 5 nights (avg. 9,600/night). Keep in mind the point redemption even covers taxes, which would turn the $232 listed above to $268 per night. Too bad I’m low on Starpoints after visiting Madrid.

You can earn Starpoints faster and get up to 25,000 bonus Starpoints with the Starwood co-branded American Express card.

3. Use the travel search engines. Expedia, Kayak, Hotels.com, etc.
You know the drill. Actually, you can search most of these all at once through Kayak.com. Sometimes one site like Expedia may have special rates for a block of rooms that aren’t available on other sites.

From Kayak, I note that the prices for the Starwood and Hilton hotels were basically the same. After sorting by price, I see that the Holiday Inn NYC is slightly cheaper at $160/night + taxes. A bit farther away in Midtown East there is the DoubleTree Metropolitan at $149. Not too bad. Oh look, Hotel Carter is discounted at $67. Too bad it doesn’t include the cost of burning your clothes afterwards!

4. Use opaque sites like Hotwire and Priceline.
Finally, there are what are called “opaque” travel sites, because you don’t know the name of the hotel until you’ve paid for the non-refundable room. You must decide only based on the star quality rating and general neighborhood of the hotel, which means you can’t look up reviews easily either. Priceline is done using a reverse auction format, while Hotwire just gives you the price.

On Hotwire, I find that I can get 2-star hotel (examples given are Comfort Inn, La Quinta, Days Inn) for $93+tax ($112 total) in a large and vague area that basically covers everything south of Central Park.

5. Using database sites to reverse engineer the hotel information. Sites like BiddingForTravel and BetterBidding gather information from successful purchasers to remove some of the mystery.

For example, what exactly might be a 3.5 star hotel in the Midtown area? Does Hotwire call the Westin Time Square 4 stars, or 3.5 stars, or 4.5 stars? What if Priceline disagrees? What one site calls Midtown West might be Midtown Central to another.

Well, here is a list of hotels in NYC that Hotwire and Priceline has sold rooms for, complete with star rating and neighborhood. From this list, the only 2* in Central Park listed is WooGo Lincoln Center. Of course this might not be the hotel you end up with, but it is a good possibility and you get a sense of quality (mixed reviews).

In addition, you can find a list of winning bids posted by users, and BetterBidding even has a calendar for easy searching. Here are the applicable ones for my situation:

Hotwire Winning Bids
4*, Central Park, Empire Hotel, $139
3.5*, Midtown Central, Sheraton Times Square, $119
3.5*, Midtown East, Millennium UN, $116

Priceline Winning Bids
4*, Midtown Central, Sheraton NY Towers, $125
4*, Midtown West, Sheraton NY Towers, $115, $110, $126
4*, Times Square, Westin TS, $169

Putting things together, if Hotwire is offering me a 3.5* hotel in Midtown Central on these dates, it is most likely be the Sheraton Times Square. Or, in the same price range, I could likely get the Sheraton NY Towers. After reading some reviews, I chose the Times Square location. The prices keep fluctuating, but when I was searching it was at $113. That’s a pretty good price for a solid hotel.

To be the most aggressive, I would go onto Priceline and bid about 20% below the Hotwire price for a 3.5* hotel in the Times Square region, say $95. I don’t want to bid too low, because each time I get rejected, I must change a search parameter (star rating, neighborhood) to bid again. Also, I run the risk of getting another 3.5* hotel that I don’t like as much.

So I held my breath, used Hotwire… and got it. Whew! In the end, I got what I wanted at 40% off the “guaranteed” low price, $113 vs. $189 per night at the Sheraton Times Square.. Over few nights, that’s hundreds of dollars in savings.

To think, if you did no research, you might end up with the Hotel Carter for $99/night! If you have tips to improve this process, please leave a comment below! I know I could try hostels or even couchsurfing and such, but that’s not what I was looking for on this trip.

Transfer Between Delta and Northwest Frequent Flier Miles

Delta and Northwest Airlines are merging, and right now you can go ahead and transfer frequent flier miles between the Northwest WorldPerks and Delta SkyMiles programs with no fees. You can even move them back and forth as you like. This is nice if you don’t have enough of either individually to get an award, but after combining you do. Also, if you link your Northwest and Delta accounts by May 31st, you’ll get 500 bonus miles.

According to this timeline, they will eventually all be merged into SkyMiles anyway in December 2009.

Free Luggage Tags From TripAdvisor.com

TripAdvisor is offering two free luggage tags. What a sneaky way to get my real info! ;) The form automatically signs you up as a member of the website, but looks like that’s all. Use a spam e-mail if desired.

Although there is the occasional fake glowing review from management or unreasonable whines from uptight travelers, I do always check TripAdvisor for hotel reviews. There are some pretty bad ones out there. Check out the reviews for this awful hotel with camping cots for beds in London and this bedbug-ridden place in New York City.

Call Your Credit and ATM Card Issuers Before Traveling Internationally

I just finished calling all of the issuers for the credit and ATM cards that I plan on using internationally – Capital One, Citibank, WaMu, and Bank of America – in order to avoid my cards being frozen due to fraud concerns. I remember doing this occasionally before, but not for all of them.

Surprisingly, every single card issuer seemed to have a specific protocol to handle such concerns. I was either forwarded to some sort of Fraud Specialist or asked to fill out a form outlining where I was traveling to and the exact start and end dates. It seems like their fraud monitoring systems are getting quite advanced. All of them thanked me for calling ahead of time, which made me feel like they’ve probably had to deal with a lot of angry (stranded?) travelers.

Oh, and they also told me the international toll-free numbers to reach their customer service from abroad. Using them is easy. Go to a pay phone, reach the operator, and call the number collect. I decided to simply write these numbers on the signature panel on the back of the cards. I’m glad I called!

For more information, see my other post on this subject: Travel and Money: Best Way To Get Cash, Best Credit Cards, and Safety Concerns. It includes why I hate traveler’s checks, why I use my Capital One card exclusively while traveling, and emergency numbers for Visa and Mastercard.

How We Tried To Save Money On A Trip To Spain

The Westin Hotel Madrid

The tickets are booked and hotel reservations are made for our trip to Spain. Of course, all this economic turmoil makes me a bit nervous, but the fact that we finally finished saving up for our 6-month Emergency Fund makes me much more comfortable. Not that we feel our jobs are in trouble, but you never know.

We did try several things to minimize costs for our 7-night stay in Spain:

Airfare: Save 50% By Combining Trips
We already committed going to a friend’s wedding on the East Coast, and so as is our habit we looked to see we could “add on” a trip somewhere interesting in that direction. For example, the ticket from West Coast to East Coast was around $350, while tacking on the trip to Spain made the flight cost $750. Effectively, we only had to pay $400 each to fly to Spain – not a bad deal! (Other European countries were $200-$400 more for some reason.)

In addition, we managed to book an open-jaw trip into Madrid and out of Barcelona for the same price. This allows us to spend more time in both cities, and we don’t have to pay to travel back to Madrid for the return flight.

We still have to decide whether to take train or plane from Madrid to Barcelona. The train is more expensive, but might be more fun? Airplane looks to be both slightly faster and cheaper, though.

The Westin Hotel Madrid

Hotels: Cashing in Rewards Points
A hostel in Madrid would starts at about $25 per bed per night, for a total of $50 per couple. But after getting married, I had to put the hosteling days behind me. :) It’s okay, I get a better night’s sleep in a hotel. A basic hotel in a decent location with a double/queen bed starts at around €80 = $120 per night. It goes up really quickly from there.

However, I have collected a fair number of the ever-useful Starpoints, mostly from my Starwood Preferred Guest Credit Card from American Express, so I decided to look at what was available. I found the Westin Palace Hotel, first built in 1912 by King Alfonso XIII as a place for his wedding guests to stay (naturally). Rated Spain’s #1 Hotel by Condé Naste magazine, it runs €305 = $450 per night!

However, I could book a room for only 12,000 Starpoints. On top of that, if I booked 4 nights, I got the 5th free. So now I had 5 nights for only 48,000 points total. At the $450 rate, that made each Starpoint worth 4.7 cents. Put another way, my Starwood card was earning me 4.7% cash back. Even at the budget hotel rate of $120 a night, I still was getting 1.25%. Except now I’m sleeping on a Heavenly Bed and staying in a palace!

Barcelona was even more expensive, but we found a simple hotel for €85 = $125 per night.

Pre-Planning
We both hate guided tours, so we usually just plan things out by ourselves with guidebooks and the internet. We like Rick Steves, Rough Guides, and Lonely Planet the best. We usually buy one guidebook that we can highlight and mark up, and also bring along three other ones + a language phrasebook from the library. Of course, we risk losing the books in which case we’d have to replace them, but I think it is worthwhile. This time around, I even checked out some Spanish language CDs. Dos cerveza por fa vor!

Churros image

Food
Standard procedure is to try and find a grocery store, and stock up on water and local snacks. A few picnics for lunch with regional junk food is always fun and tasty. Ethnic foods can also be a great value. The best tasting falafel I have ever eaten was in Paris and cost €5.

Of course, I don’t want to skimp to much on food. I will be looking forward to consuming large amounts of tapas and house wine at every hole-in-the-wall I can find. I can’t wait to try chocolate con churros! If I generously estimate about $40 a day per person for food, and given that we would pay about $10 a day for food at home, that’s an added cost of about $30 per day.

We briefly considering eating at El Bulli with Ferran Adria, but it only opens from April to September each year. Besides, I don’t think I’d be willing to drop $400 on a single meal, even if it was voted the best restaurant in the world.

Adding this all up – airfare, hotel, and food should cost an estimated $400 + $125 + $210 = $735 per person. Add in remaining transportation and sightseeing, and I think we will still come in under $900 easily. A lot of money still, but hopefully resulting in some lasting memories.

Travel and Money: Best Way To Get Cash, Best Credit Cards, and Safety Concerns

I wouldn’t say my wife and I are well-traveled, but we do try and experience other cultures whenever we can. Given work constraints and Corporate America’s hatred of vacations (2 weeks a year??), we are lucky if we can manage one trip per year. However, I think we’ve worked out a pretty good system of managing money needs while abroad.

Travelers Checks?
I never buy travelers checks. You often have to pay a fee when you buy them, and then you might have to pay a fee for exchanging them to local currency. Or you’re searching all day for the American Express office. Less and less stores accept them for purchases, due to fraud and theft. If your signatures don’t exactly match, they give you grief. If you get them wet, they are useless and you have to replace them.

Most importantly: Any place that does take them will most likely accept credit cards, which are a better alternative (see below).

Best Credit Card For International Travel
Whenever possible, I use a credit card for making purchases while abroad. Hotels, transportation, sightseeing tickets, and so on. However, most credit cards are pretty expensive when it comes to foreign currency purchases. Visa and Mastercard charge a standard 1% “conversion” fee on top of the wholesale “interbank” exchange rate. Many major credit card issuers like Citi, Chase, and American Express charge you another 2%-3% on top of that. You’re losing up to 4% off the bat.

So what do I use? My favorite card, hands down, is my credit card from Capital One . I have used this card from China to France with no issues at all. Capital One charges you only the interbank currency exchange rate. They pay the Visa/Mastercard 1% fee for you, and they don’t have any self-imposed surcharge. Finally, this specific card gives you 1% cash back on all purchases (2% for groceries/gas) and has no annual fee.

Net result: Not only do I get the best exchange rate possible, but I actually gain 1% cash back on my foreign purchases. It’s better than cash!

(I only use this card internationally. While in the US, I prefer these cash back credit cards.)

ATM Cards / Getting Cash
I used to worry about bringing some local currency with me, but it is usually expensive to get this done in the US. (Always compare their rates with the interbank rates at Oanda.com.) Nowadays, if you are arriving in a large international airport, there is hardly any chance they won’t have ATMs available. I do bring $100 in US $20 bills in my money belt as an added backup.

When it comes to getting cash in local currency from ATMs, there are also fees to be aware of. The local ATM may charge a fee, although bigger banks are less likely to. Your bank may also charge a fee for using a non-network foreign ATM. Finally, they may charge a surcharge for the currency exchange itself.

Because I use a credit card for most large purchases, I usually only need cash for restaurants and other small things. Therefore, I usually take out all the cash I expect to spend during my stay all at once, as it is no more than a few hundred dollars. Since I only have to pay these fees once, I don’t worry about them as much.

For example, on a $300 withdrawal using my normal WaMu Free Checking account, I will be charged a 3% exchange fee + no ATM fees. I am okay with paying a one-time fee of $9 for this convenience. My backup card is with Bank of America, where it would have cost $8 total (1% + $5), though they do have some partner banks with no fees. I like sticking with big banks here.

A good comparison of all these card fees is located here.

Money Belt and Wallet
After experiencing firsthand how slick a professional pickpocket can be in an Italian train, I don’t go anywhere without my trusty money belt keeping everything hidden safely underneath my clothes. I usually put in my week’s worth of cash, my backup credit card, two ATM cards, emergency numbers, and my passport.

My wallet only holds a day’s worth of cash (~$40) and my primary credit card. I usually also have travel pants with zippered pockets. This way, if it gets stolen I am only out a small amount of money and one credit card.

Lost Your Credit Card While Traveling?
You can easily report your lost card to the major issuers while traveling internationally by calling these US numbers collect. Write them down and keep in your money belt, along with any credit card numbers.

  • Visa: 410-581-9994
  • Mastercard: 636-722-7111
  • American Express: 336-393-1111