Travel Hacking 101: How to make the most of your TDY dollars
If you are a Federal Employee or Military Service Member, chances are you occasionally travel for work on Temporary Duty (TDY) status. If you’re anything like me, you travel TDY quite often (sometimes a cumulative 3 – 6 months out of the year). Whether it’s a training event, conference, meetings, briefings, internal reviews, ad hoc support, or some other Government obligation, there are plenty of opportunities (voluntary or ‘volun-told’) to travel during a career in public service. And what comes along with Government travel? You guessed it, Per Diem!
Disclaimer… Always follow the Joint Travel Regulations (JTR) when on official travel. Now, on to the good stuff.
For Government travelers, per diem is broken up into two buckets – Lodging and M&IE (Meals & Incidental Expenses. Let’s dive in further and discover how to maximize each of these, leveraging per diem to expedite financial independence.
Lodging expenses – or the money paid to travelers for living accommodations at the TDY destination (kind of self-explanatory). The daily lodging expense rate varies by location and sometimes by season but is typically enough to cover modest accommodations (think Hilton Garden Inn or Courtyard by Marriott). The General Services Administration (GSA) has a great per diem lookup tool for getting lodging and M&IE rates if you’re curious. Below is a snapshot of rates for Seattle as an example.
As you can see, the lodging rate (per day) is anywhere from $189 to $257 depending on the month. This is the maximum amount per day that the Government will reimburse a traveler for lodging while on TDY. Many hotels offer a certain number of rooms at the Government lodging rate, and most travelers will book at the maximum rate. I’ve also seen travelers book rooms at even higher than the allowable rate and pay the difference out of their own pocket – it doesn’t get much more anti-frugal than that! I get it – sometimes people have specific preferences or certain loyalty to a particular hotel chain which can be beneficial to earn points. I too enjoy earning points and am a member of many hotel rewards programs. However, if my preferred choice is over the allowable rate, there is no way I’m forking over my own personal dollars. After all, most decent hotels within the rate offer very similar accommodations for comparable prices.
But just because the rate is $189 per day doesn’t mean you have to book lodging at or above that rate, why not book something cheaper? “I’m not staying in a roach motel just to save the Government a few bucks” I hear you say. And I agree… to a certain degree. But would you be fine with staying at a comparable hotel that’s perhaps a little lesser known or doesn’t have the latest modern renovations if it is $20, $30, $50 a day cheaper? What if I told you that if you were willing to “slum it” the Government would pay you 50% of the cost savings as a bonus for your helping out the taxpayer? That’s right, you heard me, the Government will PAY YOU to save them money – it’s a win-win. It’s called “gain-sharing” and it is an incredible way to sock away some extra cash while on travel.
Do you happen to have friends or family in the location you are traveling that have an extra room or couch for you to crash on? If so, not only will you be able to see your loved ones, but also (with gain-sharing) the Government will pay you half of your allowed lodging expense as a thank you for avoiding the additional expense of them having to pay you the full rate if you instead stayed in a hotel. You can’t beat a deal like that – free money!
I do want to point out that not all Government organizations participate in the gain-sharing program, so check with your agency prior to making your reservations. There are also limitations and stipulations – so again, always do your homework.
What if you aren’t able to stay with friends and family and there aren’t any hotels in the area with reasonable accommodations that have rates lower than the Government rate? I’m glad you asked. Let’s talk about M&IE.
M&IE – is essentially the portion of per diem that is paid to the traveler to reimburse for food, toothpaste, etc. So even if you can’t secure cheaper lodging or stay with a friend, you can still take advantage of M&IE. As you can see in our Seattle example above, M&IE is $76 per day. I don’t know about you, but I don’t tend to consume $76 worth of food and toothpaste in any given day. But the Government assumes that you are a typical American and that when you are away from the comforts of your home (and your kitchen) that you will be eating out every single meal. That may be true for most, but if you are a ‘frugalista’ on the path to FI you are looking to pocket most if not all of that extra cash baby!
But how? Well, at a minimum you want to select a hotel that has breakfast. So that’s one meal you’re not paying for. But what about lunch and dinner? I suggest trying to find accommodations that have a kitchenette so that you can prepare lunch and dinner. But if you can’t find that, at least ensure there is a mini fridge and a microwave so you can make a few simple meals to get you by for the majority of your TDY. Or, EVEN BETTER, look for a hotel that offers free breakfast AND dinner – such as Homewood Suites or Embassy Suites (to name a couple). Heck, some of the suites out there (Embassy Suites being one of them) have a happy hour with free drinks! This plan, executed perfectly, should look like this:
Each morning, wake up in your super comfy bed and head down for coffee and breakfast
After eating breakfast, grab a couple of extra pieces of bread from the breakfast bar, pair it with peanut butter and jelly, ham and cheese, or whatever else they have that tickles your fancy (hint: throw in a boiled egg or two and some fruit for a side) – Now you have a “free” lunch.
After a long day of work while TDY, return to your hotel room in time for happy hour, slurp down a couple of cocktails, beer, wine (tip your bartender… always).
By this time, whatever is for dinner should be available to fill your belly (remember it’s free – and usually quite tasty).
Look, maybe this doesn’t sound like your ideal dining plan while TDY. And I’m not saying you should do this every single day. Allow yourself a nice meal out once or twice (depending on your length of stay), but stick to the above plan for the most part. Trust me, both your wallet and your waistline will thank you.
There you have it – The basics of Travel Hacking while TDY. If you enjoyed this, I suggest reading my post on how I saved 100% of my income for an entire year with long-term TDY travel hacking – The Ultimate TDY Travel Hack.