Our backpacking trip would not have been possible had we not created a detailed budget both before and during our trip. Because my husband and I were both against the idea of going into any kind of debt from this trip, we budgeted how much we would need in each city, and disciplined ourselves to sticking to that plan . . . even if that meant having to eat one-too-many peanut-butter-and-banana sandwiches.
On top of extensively planning our trip beforehand, another budgeting tip we found helpful was booking all our accommodations up front. Having already paid for these expenses, we then knew how much money we had left to spend. After arriving in a new destination, we would go to the ATM and only withdraw the amount we felt like we needed for that city. Taking out this lump sum saved us multiple ATM transaction fees, and forced us to budget the days accordingly. While we had our credit cards for backup, we did our best to only use cash so we could be more honest with ourselves as to how much we were spending.
Along with accommodations, transportation was another big cost. For us, we calculated that the 10-day Eurail pass was the best deal. While this was another expensive investment to pay up front, it allowed us to better predict our travel costs between each city.
In most cases, adhering to our budget also meant skipping out on souvenirs, which was fine since we had a limited amount of space in our backpacks. Whatever we bought, we had to carry. Therefore, instead of buying the usual trinkets, we decided to invest in a nice photo album once we returned to reminisce on our travels.