Saving Money For A Travel Adventure
World travel is one of those things that most people think is completely unaffordable, at least until retirement. If you ask most people what they wish they were doing other than working, a lot of them almost always say they wish they were traveling and seeing some of the world. Part of the reason I think that travel is so appealing is that it represents a form of constant excitement. Let's be honest, while many people like their jobs, jobs by definition involve doing work, and work isn't always fun.
Money is probably the least constraining barrier to travel for me, mainly because I have a bit of savings, and also because my company is doing fairly well. It wasn't always that way, and part of the plan for going on this trip was to put more time and energy into the company such that finances would be less and less of a concern. But without a doubt, most people think it takes a small fortune to travel the world, but the reality is far from that. In fact, if you live in North America or Europe, many places in the world will seem like bargains compared to back home.
The first place I intend on visiting in Buenos Aires in Argentina. The reason I decided to go to Buenos Aires was partially because I have never been to South America, and partially because Tim Ferris recommended it in The 4-Hour Workweek
Back in Canada, a furnished one bedroom apartment in a nice area in Vancouver will run you between $1,500 and $2,000 a month. In Buenos Aires, a nice furnished one bedroom apartment in Palermo Soho (one of the trendiest areas) is around $1,150 a month, which is a substantial savings over a place like Vancouver.
The best part about Argentina is that everything else is amazingly cheap compared to prices back home. For example, a nice steak dinner may run around $10, and a bottle of wine purchased from the market costs between $3 and $4, at least according to many of the sites I've recently been doing research on.
Place tickets are obviously a big expense, but hopefully you'll be spending enough time in each location to offset some of the costs.
In terms of costs, I'm budgeting around $3,500 a month of after tax dollars for my travels. Whether that's enough remains to be seen, but it's basically a good chunk of my income I would normally earn at home in a given month. My only real major expense in Buenos Aires is rent, which is $1,100 a month. That leaves me $2,400 (or about $80/day) for food, entertainment, excursions, and to save for the next leg of the adventure. If I factor in the original cost of my flight to Buenos Aires ($1,100) and the fact that I'm staying in Buenos Aires for three months, it's only around $366 a month for the luxury of being in South America for three months.
About six months ago I had $2,000 in the bank, and I'm currently sitting at about $5,000. My goal is to have $10,000 in the bank before I leave, which I'm still short on, but once I sell some of my furniture and bank a few more month's of salary, I should hopefully be pretty close. $5,000 of that is my emergency fund in case something bad happens, and the other $5,000 of that will hopefully be my discretionary fund that moves up and down while I travel, but hopefully stays roughly the same. If it dips too low, I'll probably have to scale back for a while, and if it starts moving upwards, then it's time to visit some trendier places!