• Choose your destination based on the cheapest flight.For instance, if you're interested in a Caribbean vacation but don't have a specific location in mind, go to kayak.com/buzz to search for flights to anywhere in the Caribbean and then pick the place with the lowest fare. Airfarewatchdog.com also lists the lowest fares available from your hometown to anywhere.

• Look for locales that are similar to your dream vacation, but with a lower price tag. For a tropical getaway, trade Fiji for Panama. For Old World European charm, try Budapest instead of Vienna. For wine tasting, consider California's Sierra Foothills region over Napa Valley. Get your fill of French cuisine and architecture in Quebec City instead of Paris.

• www.kayak.com is the site for getting the best fares. You can also include nearby airports at the starting place as well the destination for better prices and comparing fares. For traveler reviews on everything from hotels to local attractions, go to TripAdvisor.com. It just may steer you toward an unexpected bargain.

• Watch out for your bag's weight. If it is more than what is allowed by the airline you will landup paying between $50 and $150 per bag. And if it's oversized, tack on another $100 to $150 per bag. In these cases, it may be cheaper to ship your luggage, if you cannot avoid taking with you too much of it.

• Travel in the off-seasons. Timing your travel can save you serious money, plus you'll avoid the crowds. For example you can head for the winter destinations during the summer times.

• Flights on Tuesdays, Wednesdays and Saturday afternoons typically offer the best rates. Most hotels and vacation rentals are cheaper Sunday through Thursday, except in big cities that have a lot of business travelers. Your best bet for deals on lodging in those locales is a weekend stay.

• Waiting to the last minute to book your vacation can save you a lot because hotels and airlines slash prices to fill rooms and planes. Head to Lastminute.com for 11th hour deals on flights, hotels and vacation packages. It even posts last-second deals if you just have to get away today.

• The steep cost of airfare is enough to eat up any vacation budget, especially when you're bringing the whole family along. Instead, consider destinations within a day or two drive where you can travel by road. You can find a lot of books and on the internet information about such week end travel destination from your place. Another advantage of road travel is savings on the cost of fuel. According to edmund.com you can save nearly 30% by avoiding high speeds, quick starts and squealing stops.

• When traveling abroad, your credit card probably offers a better exchange rate than your bank debit card because Visa, MasterCard and American Express use their size to push for the best deal. What you have to make sure is they don't charge you an extra 1% to 3% currency conversion fee. Look for a credit card like Capital One.

• Look out for Hostel Style accomodation. Dormitory type is quite cheap while it is also comfortable. You can make reservations thru hostels.com. Most hostels come with communal kitchens and laundries, and some even offer perks such as high-speed Internet access, game rooms, TV rooms, hot tubs and organized activities for kids. Plus, many are in the center of town -- or in unique locales, such as castles, lighthouses, working farms or even former prisons.

• Watch out for bundled deals. Get a package deal by grouping your airfare with a hotel or car rental. Travelocity, Expedia and Orbitz are known for their bundled bargains.

source:Kiplinger's Mag