How to Budget for a Holiday from the UK
Plan travel, accommodation, daily spending, one-off costs and a contingency, then turn the total into a monthly saving target.
- Author
- Spendika editorial team
- Published
- 2 November 2026
- Last reviewed
- 2 November 2026
- Reading time
- 7 minutes
Quick answer
Budget a holiday in five parts: travel, accommodation, daily spending, one-off costs (insurance, transfers, parking, activities) and a 10% contingency. Divide the total by the months until you travel to get your monthly saving target, and book the fixed parts early so the remaining figure is mostly daily spending.
Holidays go over budget in predictable places: baggage fees, city taxes, transfers and – above all – daily spending. A plan that only counts flights and the hotel is a plan to put the rest on a credit card.
This guide breaks a holiday budget into five parts, shows how to set a realistic daily figure, covers paying abroad and health cover, and turns the total into a monthly saving target that slots into your monthly budget.
What should a holiday budget include?
A holiday budget should include travel, accommodation, daily spending, one-off costs such as insurance, transfers, airport parking and excursions, and a contingency of about 10% of the total.
- Travel: flights or trains, plus luggage fees, seat selection and getting to the airport.
- Accommodation: the full price including cleaning fees, city taxes and resort fees.
- Daily spending: food, drinks, local transport and small purchases × number of days × number of people.
- One-off costs: travel insurance, airport parking, transfers, excursions, car hire, pet care at home.
- Contingency: 10% of everything else, for price changes and things you forget.
How much spending money do you need per day on holiday?
It depends on the destination and how often you eat out. Research typical meal and transport prices, decide how many meals you will eat out, add a little for extras and multiply by days and people.
Daily spending is where most holiday budgets go wrong. Look up typical meal and transport prices for your destination, decide how many meals you will eat out, and add a little for treats. Self-catering one meal a day can reduce daily costs significantly in expensive cities.
What is the cheapest way to pay abroad?
Use a card with no foreign transaction fees and always choose to pay in the local currency. If a card machine offers to charge you in pounds, decline – the exchange rate is usually worse.
Use a card with no foreign transaction fees and always choose to pay in the local currency – if a card machine offers to charge you in pounds, the exchange rate is usually worse. Tell your bank you are travelling if it requires it, and carry a backup card.
Do you need travel insurance if you have a GHIC?
Yes. A free UK Global Health Insurance Card (GHIC) gives access to state healthcare in the EU on the same terms as residents, but it does not cover cancellations, lost luggage or repatriation. Buy travel insurance when you book.
Travel insurance should be bought when you book, so cancellation is covered. For trips to the EU, a free UK Global Health Insurance Card (GHIC) gives access to state healthcare on the same terms as residents, but it is not a replacement for travel insurance.
How much should you save each month for a holiday?
Subtract what you have already saved from the total and divide by the months until you travel. For a £2,211 holiday six months away, that is about £369 a month.
Subtract what you have already saved, then divide by the months until departure; the budget planner can track it as a goal. Treat it as a savings goal in a separate pot so holiday money is not spent on everyday costs, and pay for big items as you book them so the remaining target shrinks.
Worked example: two adults, 7 nights in Spain
Booking 6 months ahead:
| Flights including bags | £420 |
|---|---|
| Accommodation (7 nights) | £770 |
| Daily spending (£90/day for two × 7) | £630 |
| Insurance, transfers, airport parking | £190 |
| Contingency (10%) | £201 |
| Total holiday budget | £2,211 |
| Saving per month for 6 months | £368.50 |
Plug your own figures into the Holiday Budget Calculator to see the total and monthly saving needed.
Key takeaways
- Budget in five parts: travel, stay, daily spending, one-offs and contingency.
- Daily spending is where most holiday budgets go wrong.
- Pay in the local currency with a no-fee card.
- A GHIC is free and useful, but it is not travel insurance.
- Save monthly into a separate pot and pay big items as you book.
Use Spendika with this guide
Frequently asked questions
How much spending money do I need per day?
It depends on the destination and how many meals you eat out. Research local prices and set a daily figure per person.
When should I start saving for a summer holiday?
As soon as you decide to go. Spreading the cost over 6–12 months keeps the monthly amount manageable.
Is the GHIC free?
Yes, the GHIC is free from the official NHS service. Avoid websites that charge a fee.
How much does a week in Spain cost for two?
Costs vary by season, area and booking time. In our worked example two adults spend about £2,211 for seven nights including flights, accommodation, £90 a day and a 10% contingency. Use the Holiday Budget Calculator with your own quotes.
Should I take cash on holiday?
Take a small amount of local currency for tips, taxis and places that do not accept cards, and rely on a fee-free card for most spending. Check your destination's advice on GOV.UK foreign travel advice.
When should I buy travel insurance?
As soon as you book, so cancellation cover protects you if something happens before you travel.
Conclusion
A holiday budget that covers all five parts – and especially daily spending – means you come home with memories rather than a card balance. Total it, divide by the months to departure and save into a separate pot. The Holiday Budget Calculator works out the figures, and Spendika tracks what you actually spend while you are away.
Related guides
Sources and disclaimer
This guide is general information, not personalised financial advice. Figures in examples are illustrative; check current rates and rules with the official sources below before making decisions.
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