Travel is a routine for entrepreneurs, investors, and other business and financial professionals. Whether going back and forth across the country or flying halfway around the world, the specific purpose of business travel varies. But all forms of business travel have one thing in common — they take a significant bite out of your expense budget. So how do you save money on business travel?
Eliminating business travel from your budget may be impossible depending on your business or profession. For one reason or another, you need to travel, and that’s all there is to it. But that doesn’t mean there aren’t ways to lower the financial burden. Here are some tips to save you hundreds (if not thousands) of dollars on business travel.
According to a 2019 study from Motus, the average cost of a business trip was about $1,293. Of course, with inflation and the changes in the industry, this number has most likely shot up in the last year (and will continue to increase).
Related: How to Travel on Next to Nothing
Are business travels deductible?
Yes! Most of the costs associated with business travel are tax deductible. This includes your flight or train ticket, lodging, and even meals. Be sure to keep receipts for all business travel-related expenses.
When looking to save money on business travel, this is often one saving tip that’s overlooked!
How much travel can you claim on tax?
On a business trip, you can deduct 100% of the cost of travel to your destination, including rental cars if needed. Of course, be aware that if you added vacation days to your business travel, that you keep these costs separate.
Related: 9 Careers That Require Travel
What can I expense on a business trip?
According to the IRS, you can expense the following costs;
- Travel by airplane, train, bus, or car between your home and your business destination.
- Fares for taxis or other types of transportation.
- Shipping of baggage.
- Using your car while at your business destination. You can deduct actual expenses, the standard mileage rate, and business-related tolls and parking fees. If you rent a car, you can deduct only the business-use portion for the expenses.
- Lodging and non-entertainment-related meals.
- Dry cleaning and laundry.
- Business calls while on your business trip.
- Tips you pay for services related to any of these expenses.
- Other similar ordinary and necessary expenses related to your business travel. (ie, computer rental fees)
If you’re working for an employer, they may cover some or all of the cost of your business travel with a per diem, but you may still spend money for other costs. If that is the case, see if your employer will reimburse you.
What qualifies business travel?
The IRS defines business travel as when you travel away from your tax home that is “substantially longer than an ordinary day’s work” and you sleep or rest while away from home.
Wondering where to save money for travel? Like, what are the tactical things that you can do to save a few bucks here and there while you’re traveling for work?
Now that you know what qualifies for business travel and how to save some money with expensing and deductions, let’s talk about other ways to save money.
Use Video Conferencing
If there’s been one benefit of the COVID-19 pandemic, it’s the realization that video conferencing provides a substantial substitute for most in-person meetings and conferences. With this in mind, determine if Webex and similar technologies can take the place of business travel.
While there will still be instances where travel is necessary, modern video conference technology does a remarkable job at getting groups in different locations on the same page as each other.
Choose Your Hotel Wisely
Looking to save money on business travel via your hotel costs?
Everybody is always looking for the cheapest hotel option. But that fails to consider other factors that can cancel out the savings.
For example, how far is the hotel from where you’ll be going for business? Will you be spending $50 on cab fare getting to and from the hotel each day you’re there?
If so, maybe the closer, slightly more expensive option is better? With this in mind, take your time before booking your hotel reservations online. Compare addresses, plug them into Google Maps, and go from there.
Who says business travelers have to fly business class? Yes, the accommodations are better, and the seats have more room, but that all comes with added cost.
If the flight is only a few hours in length, consider cramming shoulder-to-shoulder with fellow passengers in coach.
You should only fly business class when it serves a functional purpose, such as allowing you to conduct virtual meetings and catch up on work you can’t do when squeezed into the middle seat. It’s also a great option for foreign travel, but be sure to compare prices there too!
Related: How to Save Money for Travel Quickly
Flights on Mondays and Fridays are generally more expensive than those in the middle of the week. With this in mind, consider flying out Tuesday and returning on Thursday.
It might not always work out due to scheduling conflicts and other factors, but midweek flights will help save you lots of money on business travel. You can use a site like Google Flights to compare the costs of flying on different days.
Limit Foreign Transaction Fees
Trips overseas come with foreign transaction fees. But that doesn’t have to be the case. Business professionals have an obligation to look into which banking institutions forgo fees for international travelers.
It might be a fraction of a percent, but that adds up to hundreds if not thousands of dollars over the course of several years of business travel. Do yourself a favor and open accounts with banks that work with those in the countries you travel to for business.
If you plan on using a credit card to get points or cash back, be sure it doesn’t charge you extra for foreign expenses too!
Related: The Best Travel Credit Cards In 2021
Business travel is far from a walk in the park. As a result, some business travelers view fine dining as the one way to enjoy themselves. But all that does is drive up your spending.
Instead, consider canceling your reservation at the Michelin star restaurant and getting cheap takeout instead. While taking clients out to eat calls for fine dining, getting your daily nutrition doesn’t take more than a trip to the nearest supermarket.
Set A Budget
It might sound obvious, but setting a budget for business travel is critical for keeping costs down. The logic is simple: unchecked spending will add up and cost more than heavily monitored finances. Rather than trusting your gut to stay below a certain price point, set a specific limit and stick to it.
How To Save Money On Business Travel Easily
Business travel is an expensive process. But it doesn’t have to be so costly. There are many ways to save money on business travel. The next time you hit the road, or find yourself in the air, try out these tips and see how much you save!
Do you have other ways to save money on business travel? Let us know in the comments below!!
AUTHOR Kimberly Studdard
Kim Studdard is a project manager for online entrepreneurs and small businesses. When she isn't spending time with her daughter and husband, or reading her growing pile of horror books, you'll find her working on her HR degree and working towards FIRE.