As my location changes during my RTW trip, so will my budget, so I’ll need to have a really strong plan in place and to set aside time for managing my finances responsibly.
I currently use Mint to keep all my transactions recorded in one place, and I honestly can’t believe it’s a free tool. This is totally something that other companies would charge a monthly fee for. But the budget categories I have set at home like rent, groceries, and utilities won’t transfer to traveling, so I need to give some careful thought to how I’ll adjust them.
My pre-trip costs – insurance, vaccines, gear, etc. – will all be paid off before I leave, so no real need to reflect them in my on the road budgeting.
My monthly income will be significantly less than I make at home, but will still be steady, so I just need to adjust that budget number once before I leave. While I’m a bit sorry to see my beloved freelance management system Elance go, the company that bought it out last year, Upwork, does have a lot of great new features, especially the ability to automate direct deposits into my checking account.
General categories that will recur from month to month, though the exact numbers may change, include Accommodations, Transportation, Food & Dining, and Entertainment. I’ll also need a Miscellaneous or Contingency budget every month for things like replacing a worn out t-shirt or restocking my supply of Band-Aids.
Things like plane tickets and most of my accommodations since I’m traveling during peak season for many of my destinations will be booked about a month or two in advance using a travel rewards credit card.
I’ll also use my travel rewards card for day-to-day spending if possible, but knowing that credit cards are less widely accepted in developing economies and that credit card processing fees can be incredibly difficult for small, locally owned businesses to handle, I know I’ll be using cash more often than I do at home.
Well hidden in my backpack will be a small cash stash in U.S. dollars – just enough to exchange into local currency and get me a flight home in case of emergency. I’ll keep a few small bills and expired credit and gift cards in a decoy wallet, something I can throw away if I’m mugged. The rest of my cash – enough to cover my day-to-day expenses for about a week – and cards will be kept in an RFID blocking wallet.
Every Friday, I’ll find an ATM and withdraw whatever cash I need for the upcoming week. I’m strongly considering switching my main checking account to Charles Schwab, which doesn’t charge ATM fees.
Before leaving a country, I’ll head to a bank to exchange any cash I have leftover to the next currency I need. This way, when I arrive in a new country, I’ll have enough to tide me over until I’m able get to an ATM there.
On the last Friday of the month, I’ll review my expenses like I do at home, but I’ll have to add the step of updating my budget for the upcoming month and possibly transferring funds from savings to my checking account.
Bouncing from place to place won’t be easy, and changing currency every couple of weeks won’t make it easier, but establishing a routine and making Friday money management day will.