Car Rental – we shopped around quite a bit and found that renting a car for pick up at Madrid airport was significantly cheaper than picking up the car from a city location. In addition, a range of alternative, smaller car rental companies are present at the airport that usually have much cheaper options than the mainstream vendors. The cars are of the same quality and the rental terms and insurance policies are the same as with bigger firms but you can save quite a bit. We have been using Centauro and have been very satisfied.
Sightseeing – the cost of entrance fees and guided tours can make a big dent in your budget. In addition to being very costly, doing too much sightseeing within a short space of time can be physically exhausting and emotionally draining. Eventually everything looks the same, especially if you have a packed itinerary. In our experience it is worth being really selective – pick only the sights that you are truly interested in and pay entrance fees for those only! Include some rest days just to lie around and relax. In this case, less is more.
Eating out – This can be expense, especially on longer trips. To experience the best of what the local cuisine has to offer without blowing out our budget within a few days, we do a combination of eating out and preparing food ourselves. When we eat out, it is generally a very special experience – a restaurant or dish that comes highly recommended and is worth paying a bit more for! On most days we shop for local produce and wine or beer from local markets or supermarkets and prepare our own meals. This also gives us the opportunity to buy local foods. We generally stay in self-catering apartments to have a kitchen available.