A realistic guide to planning your holiday budget

There’s nothing quite like booking a holiday. Whether you’re dreaming of sunshine, sightseeing, or simply switching off somewhere new, the excitement kicks in immediately. But once the excitement settles, one question usually follows: “How much is this actually going to cost?”

The good news is that planning a holiday budget doesn’t need to feel overwhelming. With a little preparation, you can enjoy your trip without worrying about overspending or coming home to a financial headache.

This guide breaks everything down into simple, manageable steps – from working out daily spending to planning for unexpected costs – so you can focus on enjoying your holiday.

Start with a realistic daily budget

Before booking hotels or planning activities, it helps to set a rough daily spending target for your trip. Having a realistic idea of what you’re likely to spend each day can make budgeting feel far more manageable – and help avoid the feeling that your spending money is disappearing faster than expected once you arrive.

Your overall budget will depend on where you’re travelling, the time of year, and the type of holiday you want. A city break in Europe will usually cost less than a long-haul family holiday, while luxury resorts and peak-season travel can increase costs significantly.

As a general guide, here’s what different travel styles might look like per person, per day:

Budget travel (€70–€120 per day)

Suitable for holidaymakers who are happy with:

• Budget hotels, hostels, or apartments
• Public transport
• Lower-cost dining options
• Free or low-cost attractions

Mid-Range travel (€150–€250 per day)

Ideal for holidaymakers looking for a balance of comfort and value, including:

• 3-star or 4-star accommodation
• A mix of dining out and casual meals
• Day trips and paid attractions
• Comfortable local transport options

Comfort+ travel (€300+ per day)

Better suited to holidaymakers who prefer:

• Luxury hotels or resorts
• Dining out regularly
• Premium tours and experiences
• Taxis, transfers, or private transport

These figures are intended as starting points rather than strict rules, but they can make it much easier to plan realistically. For example, a couple travelling on a mid-range budget could spend around €300–€500 per day combined, while a family holiday during peak season may cost significantly more.

It’s also important to remember that these estimates don’t include flights or travel insurance. Think of them as your day-to-day spending money once you arrive at your destination.

Lock in the essentials first

Once you’ve worked out a rough daily budget, the next step is to lock in the biggest costs first. This gives you a much clearer picture of what you’ll actually have left to spend while you’re away.

For most holidaymakers, the two biggest upfront expenses are flights and travel insurance.

Flights are usually the highest upfront cost

Flights are often the single most expensive part of a holiday, especially during school holidays or peak summer travel periods. Booking them early can sometimes help you secure better prices and give you a clearer idea of how much of your overall budget is already committed.

A few simple ways to keep flight costs under control include:

• Comparing nearby airports
• Travelling midweek where possible
• Booking outside peak travel dates
• Packing carefully to avoid extra baggage fees

It’s also worth remembering that the cheapest fare isn’t always the best value. Early departures, long layovers, and hidden extras can quickly make a “cheap” flight feel far less appealing.

Don’t forget to budget for travel insurance

Travel insurance is one of those costs people often leave until the last minute – but it’s worth factoring into your budget from the beginning.

Depending on your policy and level of cover, travel insurance may help if:

• You need to cancel your trip unexpectedly
• Flights are delayed or cancelled
• Your luggage is lost or stolen
• You require emergency medical treatment abroad

If you’ve already spent thousands on flights, accommodation, and excursions, travel insurance can help protect that investment should something unexpected happen. Including it in your budget early also helps avoid the temptation to skip it altogether once the rest of the holiday costs start adding up.

Once your flights and travel insurance are booked, you’ll have a much clearer idea of what remains for accommodation, food, activities, and spending money while you’re away.

The 5 main areas your holiday budget should cover

Once your flights and travel insurance are sorted, it becomes much easier to plan the rest of your spending. Breaking your budget into categories can help you stay organised and avoid overspending too early in the trip.

While every holiday is different, most travel costs fall into five main areas:

1. Accommodation
2. Transport
3. Food and drink
4. Attractions and activities
5. Emergency or contingency spending

Here’s how to approach each one.

1. Accommodation (35–45% of your budget)

After flights, accommodation is usually the biggest holiday expense. Costs can vary hugely depending on where you’re travelling, the season, and the type of stay you choose.

If you’re travelling during peak season, accommodation prices can rise quickly, especially in popular destinations.

Try to keep accommodation costs under control by:

• Booking early for the best choice and prices
• Staying slightly outside busy tourist centres
• Comparing hotels with apartments or self-catering options
• Checking what’s included – breakfast, Wi-Fi, airport transfers, or parking can all help reduce extra spending later

Sometimes paying slightly more upfront for a better-located hotel can even help you save money on transport during the trip.

2. Transport (15–25% of your budget)

It’s easy to focus on the cost of flights and forget about getting around once you arrive. But local transport expenses can add up quickly throughout a holiday.

You can reduce your transport costs by:

• Research public transport options before travelling
• Book car hire in advance if needed
• Use travel cards or day passes where available
• Walk whenever possible – it’s often one of the best ways to explore somewhere new

Even smaller costs like daily taxis or airport transfers can make a noticeable difference by the end of the trip.

3. Food and drink (20–30% of your budget)

Food is one of the easiest areas to overspend on while travelling – often without even realising it. Coffees, snacks, drinks, and convenience meals throughout the day can quickly add up.

Smart ways to save on food and drink include: 

• Mixing restaurant meals with self-catering, where possible
• Avoiding eating in tourist hotspots for every meal
• Looking out for lunch deals or early evening menus
• Picking up snacks and essentials from local supermarkets

That doesn’t mean avoiding treats altogether. The goal isn’t to strip the fun out of your holiday – it’s simply about spending more intentionally.

4. Attractions and activities (10–20% of your budget)

Excursions, sightseeing, and experiences are often the highlights of a trip. But they can also quickly become one of the biggest expenses if you don’t plan ahead.

Keep activity costs more manageable by:

• Pre-booking major attractions online where possible
• Researching free local activities before you travel
• Prioritising the experiences that matter most to you
• Leaving a little flexibility for spontaneous plans

Not every memorable holiday experience has to come with a high price tag.

5. Contingency spending (5–10% of your budget)

This is the category many people forget about – but it can often be the most important. A contingency fund acts as a financial buffer for unexpected costs such as:

• Baggage fees
• Tourist taxes
• Currency exchange charges
• Last-minute transport changes
• Medical expenses
• Unexpected purchases

Even a relatively small emergency fund can make a huge difference if something doesn’t go to plan while you’re away.

The goal isn’t to spend less – it’s to spend smarter

A good holiday budget shouldn’t feel restrictive. The goal isn’t to take the enjoyment out of travelling or to monitor every euro you spend. Instead, it’s about planning realistically so you can relax and enjoy your trip without constantly worrying about money while you’re away – or dealing with financial regret once you return home.

Holiday costs can build up faster than many people expect. Flights, accommodation, meals, transport, activities, and all the smaller day-to-day expenses in between can quickly push spending beyond the original plan. But with a realistic budget a small contingency fund,  it’s much easier to stay in control of your spending and avoid unnecessary stress.

It’s also worth considering how to help protect the money you’ve already invested in your trip. Depending on your policy and level of cover, travel insurance may help if unexpected events disrupt your holiday before or during travel.