A gap year should be a break from routine - whether it involves trekking in Nepal, bar work in Sydney or a combination of activities and destinations. In many cases, however, financial difficulties bring less savvy travellers back to reality with a jolt.

Joe Bindloss, co-author of Lonely Planet's Gap Year Book, says that many stranded gappers resort to begging parents for a Western Union transfer. With careful management, however, a bail-out should not be necessary. Here is Times Money's guide.

Budget

Before you set out, draw up a budget listing pre-departure costs and expected expenses on the road. For the latter, Bindloss suggests contacting travellers on Lonely Planet's Thorn Tree forums for advice on current prices. Estimates of daily food and accommodation costs are also available at lonelyplanet.com/destinations, and Gapadvice.org has a cost calculator.

Set against “big” costs - flights and insurance - kit, such as a backpack, day sack and trekking boots, might seem a small expense but can climb into the mid-hundreds fast. Some items may be available at better prices overseas but check in advance. Lugging camping gear to the US or Australia is pointless, for example.

Flights and visas for subsequent legs of your journey may also be cheaper abroad, the former at “bucket shops” in Khao San Road, Bangkok, for instance. Take note of new budget airlines, such as Air Asia's which offers flights across South-East Asia on the Ryanair model.

Budgeting will be easiest if you travel with a gap year organisation, such as Raleigh or i-to-i, as you pay most day-to-day costs - which may be considerable - in advance.

Be realistic

It is easy to underestimate the cost of your trip. Travelling with friends, for example, can cut overall costs significantly - allowing you to share rooms and equipment - but also piles on the pressure to socialise. “In parts of Asia, such as Thailand, the price of one beer in a bar can be more than your room for the night, plus supper,” cautions Bindloss.

Bear in mind, too, that it is difficult to find work at short notice so “I'll find a job” is not a smart back-up plan. Finding legitimate work may be extra tough, involving considerable red tape about getting work permits.

However disciplined and insured you are, it is important to keep a separate emergency fund of £500-plus.

Be insured

Travel insurance will be your most important purchase, so check the small print. Without adequate cover, the costs of accident or illness can be sky high. Chris Pinnington, of Wimbledon, Southwest London, for example, faces a bill for £25,000 after his 19-year-old son broke his legs in a scooter crash in Vietnam, in May. A clause in his Boots policy stated that holders were covered for scooter use only if they held a full British motorcycle licence.

Sports that may seem safe are classed as “dangerous” by some insurers and not covered by standard gap policies. Scuba diving below 30m is a common exclusion, while volleyball is excluded under American Express's gap-year cover.

Peter Gerrard, of Moneysupermarket.com, the comparison website, says that gap policies with Swiftcover and 24/7 cover many adventurous sports, such as bungee jumping, whitewater rafting and water-skiing. They also tend to be cheaper than less generous policies from rivals at about £185 for 12 months.

Insurers should be able to tailor a policy to your needs. You might want to drop high-level baggage cover, for instance, and add emergency dental cover, which is often not included.

Be prepared

Cash withdrawals overseas can be expensive and ATMs may be hard to find. It is, therefore, a good idea to put your cash into a Nationwide Flex current account which does not impose charges on foreign currency transactions or withdrawals. Other providers impose both, charging several pounds on a £100 withdrawal.

You should also carry some cash - in the local currency, and sterling or US dollars - and consider traveller's cheques as a back-up.

Credit cards are a useful stand-by. If you can't get one, ask your parents to add you as an authorised user.

Moneysupermarket says that the FairFX and Caxton FX pre-pay cards are a good alternative. These work as credit cards but do not allow users to go into the red, and can be topped up online - by parents, if necessary.

Travellers' checklist

Cards Carrying your entire budget in cash is asking for trouble, given typical on-the-road costs in the thousands of pounds. Credit and debit cards are safer, but be sure to note your provider's emergency telephone line in case a card is lost or stolen. Be aware that the Nationwide Gold, Abbey Zero, Post Office Platinum and Thomas Cook credit cards do not come with foreign-exchange fees, which can be significant elsewhere.

Cash You can save about 10 per cent on changing money at the airport by ordering it online - at www.travelex.co.uk, for example.

Once you have obtained currency, be sure to keep it secure. More expensive hostels may have safes, and a concealed money belt is a smart purchase.

Documents Leave copies of your insurance policy, plus bank details with your parents, or trusted friends, at home in case things go wrong. If you buy travel insurance online, you should also keep the details on e-mail.

Discounts If you are a student, or have been accepted for a place at university, you can buy an International Student Identity Card (ISIC) for £9. The company says that this bring discounts averaging £1.80 a day while travelling.

Case Study: Costs really add up

Sarah Feist has travelled in Australia twice - spending a year there after leaving school, and four months there and in South-East Asia before starting her degree course. The 22-year-old student, from Chester, says that she underestimated costs both times. “The first time I had to go to my parents after two months for a £2,000 money transfer,” she says. “I hadn't really thought much about my finances before I left - I guess most young people don't. But you do activities, like skydiving, which are very expensive and they all add up.

“I had thought that finding work to fund my travels would be easy, but it took weeks and was very stressful. The only jobs going for people without specialist qualifications were telesales and street fundraising for charities. The pay was about £6 an hour, which covered my living costs, but didn't let me save for further travel.”

Ms Feist has since paid back most of the money, but got into further debt on the more recent trip. “This time was worse money-wise,” she says. “I maxed out my credit cards, getting into serious debt, which I am struggling with. It is very, very difficult as a student.”

She does not, however, regret her travels: “Apart from the money side, I had a really great experience.”