Estimating Monthly Travel Costs: Tips for Budget-Friendly Travel

Average Monthly Travel Costs

Whether you’re packing the kids into the minivan for a trip to grandma’s over summer vacation or planning a yearlong trip abroad, there are many factors that go into your travel costs.

It’s possible to travel the world on a budget, as proven by those who have done it. Here’s an estimate of what it might cost you per month:


Airfare is one of the biggest travel expenses, and it’s been on the rise in recent years. This year’s high airfare prices prompting a number of people to change their vacation plans, either by choosing less-popular destinations or shortening the trip duration.

According to flight price tracker Hopper, it costs an average of $235 per round-trip domestic ticket to fly in 2022. However, savvy travelers can find bargains if they are flexible with their departure and return dates.

For example, booking flights on Tuesdays is cheaper than flying on weekends, and buying tickets about 70 days in advance offers the best deal. The cost of airfare spikes rapidly closer to the departure date, so plan accordingly. You can also save by purchasing travel insurance.


Lodging is one of the most common expenses for travelers, with hotel rates ranging from high-end through budget options. Vacation rentals like Airbnb offer a cost-effective alternative to hotels for families, while hostels and bed and breakfasts are more economical for solo travelers.

Travelers can reduce lodging costs by booking trips outside of popular seasons, using credit cards that offer hotel loyalty programs and preparing meals instead of dining out during their stay. They may also save money on transportation by using public buses, trains or rideshare services to get around. Lastly, they can lower the cost of food by shopping at local grocery stores and eating at restaurants that offer lower prices. A strategic traveler can plan a low-budget trip for as little as $100 per day.


Travelers also have to eat, and that can add up quickly. Food and entertainment expenses are one of the last components travelers often consider when drafting a vacation budget, but it’s essential to include them in your totals.

For Park, whose job as a foot-archery performer travels her around the world, food is the only expense she regularly spends more than half of her income on. She keeps her costs low by staying in friends’ homes, eating cheap local fare and avoiding alcohol.

On average, Americans spend $33 per day on food when traveling domestically, with about 80% of those dollars spent at restaurants. But even in cheaper countries, dining out can add up. Food stalls and street markets are a great place to find affordable options.


Travel costs varies widely based on when and where you go, as well as how you get there. Transportation costs can be a major component of your overall trip budget and you may have to consider how much it will cost for things like museum and theme park admission fees, as well as parking. Entertainment expenses also vary greatly, with some beaches offering free recreation and others charging for entry to amenities like beach chairs or umbrellas. It’s possible to save on some of these costs by planning strategically or by traveling as a group. (1) LearnVest. 2023. Accessed March 20, 2023.


When creating a travel budget, it’s important to consider all aspects of the trip, including transportation. According to LearnVest, 44% of vacationing families’ total travel expenses are spent getting to and around their destinations.

This figure includes airfare, bus fares and train tickets. It also includes parking and tolls. The average American household spends $913 per month on transportation, which includes car payments, insurance and fuel.

Despite the high cost of gas, most families still take road trips. In fact, the most popular mode of transportation is driving a family vehicle, with 21% of Americans leaving town in their car. Trains are another popular option, but they can be more expensive than flying. They’re also much more time consuming. In urban areas, websites like Citymapper can help determine how much it will cost to get around.

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Eligibility of Travel and Tourism Travel Costs for R&D Tax Relief

Are Travel and Tourism Travel Costs Eligible For R&D Tax Relief?

Travel and tourism businesses are often unsure whether their travel costs are eligible for R&D tax relief. This is because the rules around what qualifies are very complicated.

HMRC guidance states that “Cash reimbursements of expenses or other reimbursements with salary are staffing costs”. This can make it difficult to know what is and is not eligible.


Subsistence refers to the basics of survival – food, water, shelter. More philosophically, it can also indicate a state of existence or the act of living.

HMRC’s guidance confirms that reimbursed expenses can be included as part of a staff cost, providing they relate to R&D activity and the expense was initially borne by an employee. For example, John is the R&D director of a manufacturing group and flies to China on a quarterly basis for product development trials. He spends PS1,000 on flights each time, which he then has reimbursed by the company. These costs are classed as an allowable staff cost and can be claimed for by the business when claiming R&D tax credits.

However, if the flights were booked by the company via an online booking platform and paid for with the company credit card, then these are not classed as allowable staff costs. This is because they were not originally incurred by an employee.


HMRC’s explanation of staff costs leaves a bit of room for ambiguity, but it’s generally accepted that travel and subsistence expenses qualify as qualifying staff expenditure. This is good news for founders who often route these expenses through their company, especially in the early stages of a startup’s development.

To be considered a staff cost, an expense must have been paid by an employee and then reimbursed by the company. Expenses that have been paid by the company upfront aren’t eligible for R&D tax credits.

For example, let’s say Tom bought a sandwich for lunch while he was out of the office. His company may reimburse him, but because the sandwich was purchased “in order to fulfil the requirements of his employment”, it’s not an eligible staff cost for purposes of R&D tax credits.

On the other hand, if Tom booked himself flights to China in order to run new product development trials at a factory there, then these would be eligible travel expenses for R&D tax credits because they were originally paid by John and then reimbursed by his company.


HMRC guidance clarifies that reimbursed expenses which relate directly to qualifying R&D activities can be included as staff costs. This is a significant expansion of the R&D scheme and will allow businesses with sizeable numbers of eligible expenses to claim significant value in their claim. However, it is important to remember that the expenditure must first be paid by the staff member in order for it to qualify. For example, a staff engineer’s travel to a feasibility study meeting organised by the company would not count as eligible because it was not initially their responsibility.

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