As we mentioned earlier, there are many factors that contribute to the cost of your trip and every traveler is different. Some people will tell you it's not possible to predict how much your trip will cost. This simply isn't true. While there are many variables that will effect how much you spend, budgeting a trip is like budgeting anything else in life. You have to account for your own personal variations and preferences, but having a budget is crucial to making sure your trip doesn't financially spin out of control. That being said, it is hard to exactly predict a specific cost, but it is possible to get fairly close.
If you want to create a detailed breakdown of how much your trip will cost, you'll need to gather some resources. Keep in mind that it is impossible to foresee every expense. Remember, long term travel is about staying flexible. If you plan out your expenses to the very last detail, then you're probably going to have to plan your actual trip to this detail, and that is definitely not "staying flexible". Instead, allow for conservative estimates. It's better to budget too much money for something than not enough. Then, if things do go as planned, you'll have a little extra cash for when you get home, or even to spend when you extend your trip.
It is possible and advisable to create a general plan. The most basic steps include:
Determine an average daily total for each country you plan to visit. Consider accommodation, food, entertainment and transportation expenses.
Reality check that total. Approximate the cost for a hotel, food, entrance fees (museums, shows, etc), and local transportation. Consult guidebooks, other travelers, and booking websites to ensure that your budget is realistic for your travel style.
Think about how many places you plan to visit. How much will each section of the trip cost? Price out as many plane and long distance train tickets as you can. Transportation costs can be a significant part of your budget, and it is relatively easy find a good estimate for these costs. Be realistic though. If you don't think you'll take night buses, then budget enough for the more comfortable and efficient option. Don't assume you'll find that once in a lifetime deal on a plane ticket. If you're traveling in peak season, expect to pay peak season prices.
Add in costs for visas, vaccinations, and new gear. Don't forget to consider health insurance and other forms of insurance. These expenses can quickly add up. If you're planning to book an around the world plane ticket then make sure you budget for any unexpected changes. Each change will likely incur a fee.
Add at least 10% to your total, probably more. This is your budget. Reality check it one more time and make sure you've leaned on the side of conservative.
Finding realistic costs for all of these items can be tricky. Sometimes you can rely on other travelers, but sometimes not. Every traveler has their own style and priorities and just because somebody else spent one amount, doesn't mean that you'll spend the same. Some guidebooks may be reliable, others less so. Prices rise quickly and many guidebooks are at least a few years old. Hotels that are listed in guidebooks are also known to raise their prices quickly. The recommendation of Lonely Planet or other books can put the hotel in high demand so don't expect to pay the price that is listed in the book. With that disclaimer aside, we've outlined a few resources below to help you plan your daily travel budget.
The Budget Your Trip Estimate Costs tool allows you to find out what other travelers are spending. You can search by city, country, and budget type (more options are coming soon!).
Guidebooks often give you an idea of how much hotels, hostels, or food will cost in a city. It's important to remember that these costs are often slightly outdated. Expect to spend a little more than a price that's quoted in the book.
Travel forums such as Lonely Planet's Thorntree offer a great resource to discuss expected expenses in a area. The forum stays active and you can usually expect prompt, although varied, responses.
Hotel and airline booking websites have up-to-date pricing that is usually reliable. Make sure you are confirming a price during the season you plan to travel as seasonal price variations can be significant.
Travel websites such as Seat61.com offer a fair estimate of costs for intercity public transportation. Seat61.com has a thorough representation from most travel destinations.