How to Accurately Estimate the Cost of Your Vacation

When planning a vacation, it’s easy to make assumptions about what you might end up spending based on the average hotel night stay, the average cost of a meal, the average flight. However, when you budget based on general averages, you may find that you end up spending way more than you can afford. There are a few important things you need to keep in mind if you want to accurately estimate the cost of your vacation.

Take it from someone who’s been there. When Norwegian started doing round trip flights to Scandinavia for as little as $99 each way, I was over the moon. I bought an off-season ticket to Oslo and grabbed an affordable stay at a city central apartment building, I thought I was getting away with a pretty cheap long weekend.  What I failed to account for is how expensive countries like Norway are. Like other Scandinavian countries, consumer prices are insane. So while I saved myself a fortune on the flight, I ended up eating my way past my budget anyway.

That’s why it pays to do your homework. When most people are trying to decide where to vacation, their estimates of the overall cost are influenced heavily by the price of the flight, since that’s typically what most people book first. However, that fails to account for hotel prices and cost of goods, like food, at their destination. Think about this: popular travel destinations, like Boston or New York, typically have more frequent flight itineraries which means the flights also tend to be cheaper. You can get to either of these cities most times of the year for around $200 from almost anywhere in the country. But while they may be two of the cheapest cities to get to, they’re also two of the most expensive cities to stay in. A short three-night stay in the Big Apple will easily run about $200 a night, unless you stay at a hostel or YMCA.

If you do the math, it might be cheaper to go somewhere like Denver, where a flight might cost you $300-400, but you can get a decently located hotel for half the price. Obviously, the longer your stay, the bigger the effect of the hotel cost. By the same token, even though it seems counterintuitive, when you have low-cost airlines like Norwegian or WOW offering cheap tickets for trans-Atlantic flights, an international vacation might end up being way cheaper than a domestic one. Hotel stays in the US are almost always more expensive than hotel stays in Europe. And if you’re really on a budget, hostel stays in Europe can be an attractive option – unlike our stateside counterparts, which are often way more expensive and much more grimy.

Another trap people tend to fall into when booking a hotel is thinking they’re saving money by booking something slightly out of the way without failing to account for transportation costs. I once made this mistake myself on a trip to New York. Hotels in Manhattan are extremely overpriced, so I went for something in Queens that was a 15 minute walk from the nearest subway station, to save $50 a night. Doesn’t sound like too much of a sacrifice on paper until you consider the fact that we didn’t want to walk 15 minutes in Queens after dark so we ended up taking a cab home every night. Overall, I probably broke about even, but I would have saved myself a lot more time had I stayed somewhere central to begin with.

But of course, no one wants to travel to the other side of the world to stay in a hotel for 5 days. You’ll also have to consider the cost of attractions and activities when summing up the cost of your vacation. Some cities, like London, are very budget-friendly when it comes to things to do: you can get free entrance to many museums and sights around town. On the other hand, if you want to do anything in Paris like go up the Eiffel Tower or visit the Louvre, you’re going to have to pay up. It’s helpful to work in these costs into your budget in order to accurately estimate the cost of your vacation because those little things add up. Cities like Las Vegas might seem cheap at first, but most people go to Vegas and spend a ton of money gambling or on shows. Don’t forget that when you’re working on your budget and tallying up your totals.

You may also want to coordinate some day trips out of your primary destination, because you might be closer to some attractions or locales than you will ever be. So if you think that spending a day in Stonehenge when you’re in London is a must-do, then you should probably tack on another $100-200 to your budget for the cost of transportation and entrance.

It also helps to know the exchange rate where you’re going. You might make out like a bandit in Eastern European cities like Budapest, but if you’re going to the UK prepare for the shock of the pound. Your cash will automatically be worth 30% less and on top of that everything will cost a little more than you’re used to.

Once you’ve done all that, you probably have a good idea of what your vacation will cost and you can rest easy knowing that your budget is reasonable and accurate. Even so, life happens. You only live once and some places you  might never see again, so if you end up going over budget, you’ll live.