Let me start by saying that vacations comes under the heading of "experiences" for me. That means that vacations are actually one of the places where I feel its okay to spend the money I'm saving elsewhere. Figuring out how to vacation on the cheap is more about extending the possibilities of the experience (and extending the vacation itself) than about being cheap for the sake of being cheap.
I live in the northwest and the rest of my family all lives on the east coast, so many of our vacations are spent in New York. Plane tickets to New York are astronomical - often over $1000 a piece these days. Since we live in a small northern town, we pay $500 - $600 just to get to Vancouver.
So we drive instead. And we've gotten the cross-country trip down to a science. Gas, hotels, and food cost about $3,000 round trip - half the price of flying!
Interestingly enough, six people driving in one van creates about 40% less carbon dioxide than six people flying in an airplane, so if your carbon-conscious you save that way, too.
Our trip takes five days and four nights. Since I know our route well, I book the hotels in advance and make sure we get a pool each night, and a continental breakfast, if possible. We get up early, pile in the car, listen to audio books while we drive, eat lunch in the car (tons of sandwiches), stop for dinner at a fast-food joint and break off in the evening early enough for a quick swim (or a few hours at a waterpark in Wisconsin), before falling asleep.
I generally get us two nights where we stay in a suite with a separate bedroom for mom and dad, and two nights in more budget accomodations.
This works for us because we've set up our lives in such a way that my husband can take his work with him. Once we reach New York we stay with family for at least six weeks. My parents have room for us, and they've installed DSL in our room so that my husband can plug in his computer as soon as we reach there and get back to work. (Poor guy - although the beauty of doing work you love is that, well, you love it!)
What would we do if we didn't have this family situation?
Well, my next option for a cheap vacation would be camping in state parks or other recreation areas. Most people have several of these within a day's drive and you can make camping as simple or as elaborate as you like.
This year my family is staying home. I'm taking a quick trip to California, but I'll be couch-surfing at friends' houses, so my flight is my only expense. Since the cost of flying is so outrageous, I called a travel agent and told her what I was looking for. Then I waited until she called back with a seat sale. If there hadn't been a sale, I wouldn't have gone.
If you're really short on cash but you want some sort of vacation, my advice is this. Pretend you've just moved to the town you live in, or better yet - pretend you're visiting from Belgium. Look up your town on the internet and read through the tourist highlights about it. Are there places you don't go because they're "just for tourists"? Try them out! Dig out your camera and photograph your town the way you would if you were just visiting. You might be surprised at some of the gems you find close at home. Set up a few days' worth of activities as if you were preparing to show a guest around, and then do them yourselves. Walk up to strangers while you do this and ask them questions about things. You might meet some new people, too.
I was just talking to a friend in the supermarket today about what if instead of taking a vacation to a far off place you stayed right where you are, but met and talked with everyone within a three block radius of your house. Like sat down, ate a meal and had a drink - took time to really talk. That might turn out to be way more fun, entertaining and enlightening than a safari to Africa ever could. I wish I wasn't so damn shy - I'd try it out.
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