How much should you spend on Travel?

How Much Spend on Travel

This is one of the most important questions that we ask ourselves every single chance we can: How much should you spend on Travel?


I was doing the December 2015 budget a few days ago, and I got the idea to look at not just how much we spend  per month on different things, but also how much we spend on travel as a percentage of income.  The answer was pretty illuminating, actually.  You get to see that the biggest expenses are essentially out of your hands, and that you don’t always need to sweat the small stuff.  I’ll be posting these every month this year after I do the budget, so it will be interesting to see any new patterns in spending that emerge. For more information on how much we spend our money on travel, read on.

How Much Spend on Travel
How Much Spend on Travel

How to read our budget:

For privacy purposes, we don’t actually put in the actual numbers of our earnings. We earn our income by both having full-time jobs and side hustle for extra cash by renting out our spare bedroom on AirBnB (to get $20 off your first booking, let us know so we can email you a referral code). So, you might want to stay in our room if you are looking for a great deal in the Jacksonville, FL area! We also try our luck here and there with freelance writing but it has not really been that profitable for us (yet!)


Our expenses for 2015, all in a glorious percentage:

Income Percentage 1

Here are some main takeaways:

  • Our 3 biggest expenses are Retirement Account (401K), Taxes & Insurance, and Mortgage. These comprise 70% of our expenses. These won’t really change unless we decide to reduce the retirement portion, but since we are big proponents of saving as much as possible, we’ll keep it as high as we can. We are doing this so we can become Financially Independent (FI) as well, so we’re going to try to grow our money whenever and whatever possible way we can – even in a turbulent stock market period. We also decided to buy a house instead of keep renting. Why? Because we think the area we bought in has potential for growth (and possibly future appreciation).

    So instead of paying someone for the privilege of living in a certain area, we bought a (town)house and we’re saving more money by renting out our spare room – half of the proceeds of which goes to additional principal payments in our mortgage, and the other half for other business opportunities/discretionary spending. Once we have fully paid off our mortgage (hopefully in less than 10 years), we’ll just have to pay for insurance, taxes, utilites & the HOA – no more renting (which goes up an average of 5% in Jacksonville). You may also read our Real Cost of Travel post as we compare buying a modest sized home versus a large one and how that correlates to travel expenses.

  • Dining Out is our smallest expense at 1.10%. We love to cook and try to limit the amount of times we go out every month.  However, we do love to go to Bento (Asian Fusion food chain with excellent and affordable food) and Firehouse Subs (amazing sandwiches) once in a while. Of course, when we travel we also eat out a lot, as we like to try other cuisines.
  • Travel takes up 6.6% of our overall budget even though we travel a lot (also see our 2015 Travel Calendar post), so this percentage would be a lot higher if it weren’t for all the travel hacks we use in terms of airline miles and hotel points.
  • Car Maintenance sits at 3.31%.  Since our car was paid off a few years ago, we only spend money on gas, car insurance, and maintenance (things like oil changes and tire rotations).
  • Groceries is 2.76%.  We shop at Aldi, a discount Germany grocery chain, which has very cheap prices on most things, and we also sometimes drop by Publix for their BOGO deals (buy one, get one for free) as well as Trader Joe’s (they have items that most grocery chains don’t, like Xiaolongbao and Gyoza).
  • Utilities are 2.21%. This covers electricity, water, and sewer costs, which are provided by the Jacksonville utility, JEA. This spikes a bit in winter and summer, but we don’t use the A/C very often (we turn it off during the day when we’re working) and try to utilize fresh air by, gasp, opening windows once in a while!
  • Gifts & Miscellaneous are 2.21%. These are random things like clothes, birthday and holiday gifts, and activities like going to concerts and museums.  This is where we flex our Groupon muscles to get big discounts on a wide variety of events, from dinner theater shows to skydiving and hot air balloon rides.

Income Percentage Chart

So, to answer your question – How Much Should YOU spend on travel?

The answer to that is quite simple: spend as big of a percentage chunk you can without compromising your living expenses & your savings rate.


If you manage to cut out on other discretionary spending like eating out, gifts, shopping, or rent, you may have a bigger chunk you can use to travel. We manage to have a big allocation for our retirement account because we want to be Financially Independent. We are averaging more than 50% in savings a month, as compared to the average American that saves less than 10%. A little goes a long way, and we’re just a bit sad that we only started during our late 20s/early 30s in being more aggressive with our savings.

We also decided to buy a house as sort of an investment (although half of it is mostly an expense)- but mostly as a way to save more. Rent in our area goes up to 5% a year – our neighbors apartments cost around $1,500 to rent a month alone, as compared to our modest mortgage of $1,200. That’s $300 saved every month – and we get to use the extra money we get from our roommate to accelerate our savings.

So, more travels but only allocating nearly 7% of our income every month. Isn’t that grand? Share below how you plan to allocate your spending and if you are trying to make your travel chunk bigger!

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