Before you go on holiday

Save, save, save. Unless you're going on a last minute whim, you should be able to put a little cash aside each month to help cover the cost of the trip or make sure you've got money to spend when you get there. If you're taking advantage of a late deal, make sure you have a plan on how you will pay for it when you get back if you don't already have money set aside.

You should also take time out to pre-book car hire or rail connections, as you can often get better deals if you book in advance. It's also worth checking the fine print of your travel arrangements - some airlines and hotels have a habit of charging you extra for things like baggage and sun loungers.

Flight-only holidays

Comparing budget travel to business class is like holding a big packet of chalk up against bucket of melted cheese. However, you'd be hard pushed to slide a Rizla paper in between budget and a standard economy flight. Sure, there's no meals or films but you'll save a fortune and you can keep yourself fed and entertained by bringing your own snacks, books and games.

Like long haul flights the best deals are available in advance or by travelling midweek but bear in mind that budget airlines often fly into airports further from the cities and resorts you're trying to get to. Do some online research about how much it will cost to get from the airport to your destination and factor that in when deciding whether to go budget.

Budget accommodation

Once you have the flights sorted you'll need to find some accommodation. If you're not into the idea of staying at a hostel, crashing with friends or going camping, look in guidebooks or ask people who've been before for suggestions on budget hotels.

"If you want to save money you should avoid the main drag," says Oliver Broad, panel member of the Association of Independent Tour Operators [AITO] specialist travel agents. "You'll pay a premium for a hotel right on the beach, but one a couple of blocks back will be much cheaper. Avoiding big chains may also help. Smaller, family-run hotels often have better deals."

Package deals

Tour operators can often secure flights and accommodation at much better prices than you could if you tried to book independently. They are subsequently able to offer package deals, where you buy the flight, accommodation and sometimes even the meals as one entity, at vastly cheaper prices than you'd be able to get yourself.

These deals can become even more attractive if an operator still has spaces on flights and hotels as the date of departure is approaching.

With so many tour operators going bust at the moment, it's best to check the company offering the package has an Air Travel Organiser's Licensing [ATOL] licence. That means you'll be able to claim your money back if they go belly up.

Most package deals will insist you have travel insurance, so shop around to get the best one for your needs. For instant quotes use online comparison sites, such as moneysupermarket.com, gocompare.com or comparethemarket.com.

Eating on holiday

The only problem with three square meals a day, especially when you're on a budget holiday, is cost. Self-catering accommodation allows you to save on restaurant bills by making your own food. But there are ways and means if you do want to sample the local culinary delights.

"Just like with accommodation you need to be prepared to get off the beaten track," says Oliver. "Look in guidebooks, ask people or just use common sense - a meal in the main square will be much more expensive than one a couple of blocks away. Don't be afraid to try places full of locals, they're usually cheaper and more interesting than the tourist traps."

Changing money

Many places are happy to charge you for the pleasure of swapping your pounds for the currency of your holiday destination. However, you can avoid these charges if you exchange your currency at commission-free exchanges like the Post Office. Or you could just use a pre-paid currency card.

"Many companies are now offering pre-paid currency cards that can be loaded up before you go," says Oliver. "If you're going to Spain, for instance, you can put 300 Euros on the card before you go, which helps with budgeting, security and expenses. If you lose it you just cancel it and you don't get charged extra for taking money out of cash machines. Santander also do a Zero card, which would be a really good thing to get if you're spending a lot of time away, like on a gap year, as it doesn't charge you extra for transactions made abroad and you can settle the bill when you get home."

Earn your keep

Most people go on holiday to get away from work but if you're going for a longer period of time, you may want to consider taking on a casual job whilst you're away. It's a great way to meet people and help towards the cost of your trip.

"There are highs and lows to working whilst travelling but ultimately it is an enjoyable experience," says Darren Holmes, who worked for a while whilst travelling around Australia in his mid-20s. "I had a variety of jobs from fruitpicking in Queensland to packing shed work in Bowen and shoe shop assistant in Perth. The farm work was the hardest but I was able to save a lot of money because I tended to be located in a remote area so couldn't spend anything!

"In places like the Northern Territory and Western Australia you get paid 'remote pay' on top of your basic wage. I worked for six weeks, taking every shift available, and saved $4,500! That enabled me to not have to work for several weeks and helped fund my trip around Asia."

Staycation

The Office of National Statistics reported a 15% drop in foreign holidays in 2009, as more people opted to enjoy their time off within the borders of our green and pleasant land. By joining them you can save money on flights, currency exchange and even accommodation if you camp or get a self-catering apartment or cottage.

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Updated: 17/10/2011