We all need a break – and whether you want to relax and recharge, or reconnect with friends and family, holidays are a great way to improve your health. In fact, the Framingham Heart Study, a long-term cardiovascular study in the US, has found a strong correlation between taking frequent holidays and living a healthier life by reduced stress.

As beneficial as they are, holidays can also be expensive. Thankfully, there are ways to take a break on a budget. Here’s how.

1. Picking the right time to holiday to stretch the budget

Timing can make a huge difference to the cost of any holiday. Travelling during off-peak times can provide a significant cost saving on everything from airfare and accommodation to car hire and activity costs, although this may not always be practical for families with school-aged children.

“Avoid school holidays if you can,” advises travel industry expert Leonie Fraser. “If you are travelling domestically, remember to check other states in Australia as the school term dates can differ.

“There are generally four travel seasons – low, shoulder, high and peak. Seasonality varies for each destination depending on weather and popular events – for example, Summer in Europe is peak season, while in Canada and North America it’s during their Winter ski season.”

The savings can be substantial, adds Fraser. “Generally, you can expect to save hundreds per person, depending on the destination. Many airlines also offer their own discounts and you can sometimes save well over 25%. You can also find ‘fly free’ or ‘partner flies free’ offers when booking some tours, which obviously is a substantial saving.”

2. Choosing a location to holiday on a budget

It may sound obvious, but a trip to Venice may drain your wallet much more than a Bali sojourn. Choose to holiday in countries where your dollar will travel further (checking currency exchange rates is a good idea), with budget-friendly options including India, Cambodia and Laos in Asia, or Bulgaria in Europe.

3. Plan ahead to get travel discounts

Booking your holiday well in advance is another way to save money. “Many tour companies and airlines offer early bird booking discounts,” says Fraser. “Traditionally, these discounts apply for European destinations, however many travel companies have now jumped on board so as not to miss out on the booking action, so you can often find savings on travel to pretty much all destinations.

“You’ll often find outstanding airfare deals to Europe and the US – for example, an airfare to New York might be close to $1000 cheaper than usual when booking during early bird periods.”

4. Be smart about meals when travelling

Eating out for breakfast, lunch and dinner every day can be expensive, and even more so when you add snacks and drinks. Consider stocking up on supplies at the supermarket or local produce markets – these are popular throughout Europe and Asia – and steer clear of tourist restaurant traps. “Get away from the main tourist strip, where you can be sure to pay a premium,” Fraser says. “Wander a little further and look for restaurants filled with locals – they are usually the safest and tastiest bet. Markets, hawker centres and in some places, food courts, offer delicious budget-friendly meals.”

5. Consider house swapping to save money

House swapping is an increasingly popular way to holiday – a survey by house-swapping site HomeExchange.com found that more than 90% per cent of Australian respondents had positive house-swapping experiences and most of them had done it more than once. Accommodation can be one of the most expensive aspects of a holiday, so you could save hundreds or thousands of dollars depending on your destination and duration of the holiday.

6. Make the most of free activities

From relaxing on the beach to visiting free museums, there are plenty of activities you can enjoy for free – no matter where in the world you travel. For big-ticket sights, organise your own excursions rather than pay for tours. For example, a commercial tour from Paris to Versailles can cost about $85 – you can save half the cost by taking a train and booking your own admission ticket online.

7. Be data-smart to avoid bill shock

Avoid bill shock by turning off your mobile data when travelling overseas. The cost of data roaming can be outrageous – between 50 cents and $3 per megabyte, and sometimes as high as $15. At the $3 rate, uploading a photo on Facebook could cost you $4. Most hotels, restaurants and bars have free wifi, as would many house-sharing homes, so you can still get your daily social media fix.