How to Plan a Trip Around the World: Money Matters

In case you’re just joining us on this series, Angela and I are taking a year-long trip around the world beginning this summer, and we are writing a collection of articles detailing our planning process for such an adventure.

We’ve already shared How to Plan a Trip Around the World: The Route. This section, Money Matters, will explain how we are able to afford this extended journey. Additionally, it will include a few financial travel tips that everyone can use no matter their travel goals.

First off, Angela and I are not rich. We didn’t work for an Internet startup in Silicon Valley. We aren’t trust fund kids. And despite my fantasies, the most treasure I’ve found while scuba diving was a ratty one-dollar bill in Roatan. So, we aren’t interested in luxury hotels or exclusive resorts where the only locals you meet are part of the wait staff.

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My diving “treasure” from Roatan, Honduras

Nor are we backpackers who travel on a shoestring budget, content to sleep on couches or share barracks-like accommodations with a constant rotation of strangers, as interesting as they may be.

If you do fall into either of those categories, then this isn’t a judgement. Travel is the important thing. And, no matter how you travel, you’re still out there, making those memories.

We, however, are career people in our forties who have simply worked really hard to save and plan in order to afford a life of adventure. As one of our favorite investment bloggers says, “You can afford anything. You just can’t afford everything.” It’s not easy. It’s not sexy. But it gets us to our primary goal of experiencing the world in its entirety.

That said, here are the specific things we do to make travel more affordable.

Cut down on the small luxuries to afford the big ones. For us, shopping isn’t a form of catharsis. We don’t buy new clothes or shoes unless our old ones are literally worn out. When we do buy clothes, Angela scours the internet for affordability and free shipping. Moreover, she is always conscious of whether the item in question will make for good travel. If it doesn’t meet that minimum requirement, we typically don’t buy it.

Angela doesn’t spend money on manicures, pedicures, or other luxury beauty treatments. I’m fortunate to have married a natural beauty, inside and out. And her frugality only makes her more beautiful in my eyes. She gets a haircut about once every two years. Likewise, I’ll get an infrequent haircut once every three or four months, and I’m fine with a walk-in barbershop. It’s just hair, after all.

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Amazing shawarma in Marrakesh, but still second fiddle to Angela’s cooking

We do love to go to restaurants (keep reading to turn restaurant meals into miles), and Chattanooga has a fairly impressive food scene. But there are few restaurants that can compare to Angela’s home cooking, and none of them can beat the price. So, we cook at home and eat leftovers as often as possible. This is a simple shift, but a restaurant bill can easily run us $100. When I can add a couple of one-way flights to a new destination for $39 each, it puts the cost of the meal into perspective.

And eating at home doesn’t mean we have to sacrifice exotic flavor. Angela makes the best chicken shawarma I’ve ever tasted outside of Lebanon.

Yes, please, I’ll have a second helping!

Mileage-earning credit cards are invaluable. This takes some dedication and involves a paradigm shift in how you spend money, but the payoff can be huge! I love paying with cash and absolutely abhor credit card debt, so this was a difficult transition for me. But I’m a true believer now and can attest to the benefits of responsible credit card use.

Certain credit cards provide amazing travel benefits, including free hotel stays, free rental cars, and even free flights. To travel extensively on a budget, you will need to become an expert with this information. Buckle up!

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Basically, you just insert a credit card as the middle man for any bill you would regularly pay with cash or a debit card.

Going out to a fancy dinner? Pay with a credit card and then go home and pay the bill immediately. Need books for school? Pay with a credit card and then go home and pay the bill immediately. Want to book a flight to Spain? Well, you get the point.

The credit cards are counting on the assumption that you will carry balances over to the next billing cycle. For them, it’s all about accrued interest. Deny them this joy and pay your expenditures off as soon as you accrue them. You don’t have to wait for the end of the month. Seriously, if you can do this, then you’ve unlocked a travel advantage that will keep paying off.

If you miss a payment, however, forget everything I just said. In that case, good luck and godspeed to you financially.

So, which credit cards should you get? There are lots of deals out there (you probably get several offers in the mail every week), but here are the ones we’ve tested and can recommend:

Full disclosure: We may be compensated when you click on the credit card links above from American Express and Chase. However, you may get a bonus, too! Opinions on this site are ours alone and have not been reviewed or approved by the card issuer. But we would never recommend something we didn’t love and find useful.

Each of these cards has a sign-up mileage bonus of 30,000 to 60,000 miles that typically involves spending a certain amount of money within the first three months. Usually, these amounts are somewhere between $2000 and $5000 USD. And they often offer an additional mileage bonus if you go above and beyond those minimum benchmarks. An extra 10,000 miles for an extra $1000 USD spent, etcetera.

Don’t hold me to these numbers as they are forever fluctuating. But ThePointsGuy tracks this stuff religiously, so take a look at his site before you make any decisions. If you love us at all, however, please come back here before you sign up for anything! (See Referral Bonuses below.)

For a trip around the world or an extended trip where you will fly several affiliate airlines, sign up for all three cards several months in advance. Then, leading up to your journey, pay all of your expenses through the most beneficial card(s). The miles you accrue through the cards will post during the next billing cycle and can be spent for tickets during the second half of the journey.

About those referral bonuses … The saying goes that two people can live as cheaply as one. While a couple of travel aspects can certainly support this adage (e.g. hotel rooms and rental cars), travel expenses can easily double when it comes to airfare, excursions, and food. So, here’s a way to recoup some of that expense: most mileage travel cards offer a bonus for people who refer others.

I was the test case for this one and originally signed up for all three cards. Because we were booking flights like crazy, I quickly hit my expenditure bonuses. Then, I sent Angela a referral link for both the Delta AMEX and the Chase United cards. When she signed up and spent $1000 USD on each of her cards, I was immediately credited with an extra 10,000 miles per card. Unfortunately, the AAdvantage card no longer offers the referral benefit, although it’s still an excellent card to have. And they will likely offer some type of bonus again in the future, so keep an eye open.

Since I had met all of my bonus levels, we shifted our collective process and started using her cards exclusively so she could hit her mileage bonuses as well. All told, we have now earned nearly 500,000 miles. With many one-way flights requiring 30,000 miles or fewer, that’s 16 airline tickets for free!

And those miles go even further in certain regions: the United card has lots of affiliates in Eastern Africa, while the American and Delta cards seem most promising for flights in Southeast Asia.

To give you an example for just how effective bonus miles can be, I booked one-way tickets from Maputo, Mozambique, to the Seychelles (regularly $350+ USD) on Ethiopian Airlines (a United Airlines affiliate; see below) for only 17,500 miles each, plus $45 USD per ticket for additional fees. That’s a savings of over $600 USD! And, if you use the United card to pay for the minimal fees, you’re essentially double-dipping and paying your own bonus forward to yourself! (Sorry about all of the exclamation points, but saving money on international travel makes me a bit giddy.)

The benefits of special promotions. So far, I have found the United MileagePlus card to be most valuable in this department. They are forever sending me promotions for everything from wine clubs to cruise deals to restaurant offers. Almost invariably, these promotions have no signup fee, include bonus miles just for registering, and also offer multiple miles for every dollar spent.

For instance, with United Dining, there is a signup bonus of 2,500 miles awarded just for using the United MileagePlus card at affiliated restaurants. In Chattanooga, there are only four restaurants participating in the promotion, but two of them happen to be among our favorites. In addition to the bonus, you get three miles for every dollar spent, and you can add multiple cards to the same account that will also earn their own signup bonus.

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Dining with benefits at Main Street Meats

The bottom line is, Angela and I have enjoyed four restaurant meals (two meals apiece at two of our favorite restaurants) using my United card twice and her United card twice, and we have earned enough miles for half of a $300 USD ticket from Gabarone, Botswana, to Cape Town, South Africa. We just saved $150 USD by doing nothing more than eating at our favorite restaurants, which we would have done regardless!

Use the correct airline card for every travel purchase. This goes without saying, but I’ll say it anyway. If you’re flying United or one of its affiliates, then book the flight using your United card. Likewise, AAdvantage card for American Airlines. Delta Skymiles for Delta. And use the correct card for any in-flight purchases as well. You will typically get multiple miles on the dollar as a reward, and it earns points toward exclusive (read: even more rewards) memberships.

When it comes to airlines, we aren’t brand loyal. I’ve had some fantastic flight experiences with every major carrier; I’ve also had some terrible ones. People like to dish on this airline or that one, and I’ve heard statements like, “I’ll never fly with them again!”

Perhaps it’s my dogged optimism, but I’ve found that airlines, like people, have good days and bad days. I’ve also found that part of the travel experience can be controlled by me. When I smile, demonstrate patience, say please and thank you, keep my area clean, and maintain a generally pleasant countenance, the airline staff tends to reflect the same back to me.

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The Internet is rife with horror stories of ill treatment from airlines despite our best attempts to share peace and love, but typically the video of the pleasant flight attendant doesn’t go viral. So, when I see stories of airlines behaving badly, I chalk it up to an isolated case.

And I watch the prices like a hawk.

You see, when airlines have a bit of bad press, people will switch carriers in droves. And the airlines often compensate for that by offering better mileage deals (see the previous section) or simply by dropping ticket prices. I’ve caught several deals this way.

Maybe that makes me an opportunist, but it also saves me money and gets us further down the road. And, let’s face it, my boycott protest of this airline or that one only serves to limit my choices, which, ultimately, makes my travel more expensive.

So, let’s talk about choices for a moment. In the U.S., we have three major airlines (American, Delta, and United) and several very competitive smaller ones. The smaller airlines offer limited flights outside the U.S., so they aren’t really part of the consideration for this trip around the world. The flight routes of the three major airlines are limited as well, almost invariably including a stop in the United States. Again, not exactly conducive to planning a one-way trip around the globe.

Those same carriers, however, serve as the anchors for three massive airline alliances that contain a great many affiliated international airlines. Moreover, the airline miles accrued through one of the big three carriers can be spent for flights on affiliated airlines. And, if you set up your accounts correctly, the opposite is true as well.

Now we’re getting somewhere! You can find a table of alliances and affiliates below, with links to more information about each member airline. When I discovered this little nugget of information, our accrued miles became even more valuable.

One World Alliance (American Airlines)
SkyTeam Alliance (Delta Airlines)
Star Alliance (United Airlines)

For an additional bonus, when signing up for a foreign carrier associated with one of the above alliances, look for a place to enter the frequent flier number of a major carrier instead of the smaller one unless you’re planning to fly on that carrier often in the future. In other words, put all of your miles in one (or three) baskets when you can.

Ground travel can earn you sky travel. American Airlines has partnered with Avis and Budget to help you parley rental car expenditures into miles toward free flights. And United Airlines has done the same with Hertz.

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The open road is often the greatest adventure.

Since we will be renting around 40 cars during this trip and driving in over 60 countries, I’m banking on these partnerships to pay for flights during the last stages of the journey. With up to 1000 miles earned as a baseline per rental and additional miles earned through qualifying purchases, this should save us another $1000 USD for doing nothing more than paying for each car with the correct card.

On top of that, using the correct card for the associated car rental almost always includes insurance coverage above and beyond anything you can purchase from the rental company. However, sometimes you need to read the fine print to figure all of that out. For instance, credit card companies are notorious for excluding certain countries from their universal coverage list. So, although you might be covered while driving in France, that coverage becomes null and void when you cross the border into Italy.

Concerned about this very border crossing, I took a deep dive into the information and found that the AAdvantage card provides $100,000 USD in insurance when you rent through Avis. And, more importantly, the coverage applies to every country! Italian problem solved.

Cut the financial fat. Nearly a year ago, Angela and I started having conversations about how to pare down our monthly expenses, asking what bills we could eliminate to help save for this trip.

The first casualty was our monthly cable bill. We realized that we seldom watched television anyway, getting all of our news and most of our entertainment online. Likewise, magazine subscriptions were eliminated. We pared our phone bill down to the bare minimum and became even more conscientious about utilities, saving money with every passing month that could be used to fuel this year-long adventure.

But that was all still small potatoes. The real epiphany hit when I realized I could sell my truck before we left. I still owe about $8000 USD on the loan, paid in monthly installments of $350 USD, and we are obviously required to carry full insurance coverage on it, none of which will be beneficial to us while we are traveling for a year. By selling the truck just before we leave, we will not only save the $350 USD monthly payment and insurance coverage but also get a quick influx of cash to take with us.

Plan. Plan. Plan. Creating an itinerary and answering the money question for this trip has become a second job for me. Since I’m middle aged and have multiple real-world responsibilities, I don’t have the luxury of arbitrarily bidding my current life goodbye and hoping for the best with this new venture. I’ve had to crunch numbers, shift priorities, and make sacrifices that will, hopefully, pay off with new opportunities.

But, ultimately, you can’t put a price tag on travel. Despite the cost, the reward is infinite. Always. Without fail.

Next up — How to Plan a Trip Around the World: Timing is Everything