In the process of booking last summer's family package holiday, something I have tended to do almost automatically every year (pick a destination, choose a holiday from the variety of brochures and book well in advance), I paused to wonder just how much someone as tight- fisted as I might save by arranging the excursion myself.

It was only a whim, but I decided at least to experiment. Instead of popping into our local travel agents with my cheque book, I sat down and made a few phone calls.

The four of us had set our hearts on one week in Andalucia, touring the Costa de la Luz, visiting Seville, Cadiz, Jerez and then on to Granada. We had already chosen from brochures the four- star hotels we would stay in. We wanted to travel in a car that would comfortably accommodate all of us and our luggage. We had determined the dates on which we could travel, and the most convenient airports. There was a package that suited our needs precisely, offered by The Magic of Spain, through Lunn Poly. Included in the price were air tickets, hotel accommodation, car hire and insurance. We elected to try to arrange the same all-inclusive package.

By using the prices quoted in the brochure for all the extras, such as additional nights, half-board supplements, car hire and extensions to travel insurance, we were able to calculate how much was being charged for each component of the holiday.

Our first consideration was flights. We scanned newspaper classified airfare sections and viewed the vast range of agents. And we bought a copy of a booklet called The Airfares Guide, which lists discounted scheduled services. We were unsurprised to discover that scheduled flights were much more expensive than charter offers. We concentrated on finding the cheapest, not knowing one charter company from the other, and chose the best price available (offered through a small, refreshingly friendly company called Global Flight Check). The possible dates for travel were, in fact, more convenient for us than the limited choice offered within the package. We paid pounds 120 per person, compared with the tour operator's charge of pounds 235. We could fly to and from the same airports used by the operator, and were placed on one of their preferred carriers (Monarch).

The telephone numbers for the two hotels which had caught our eye (the magnificent Hotel Monasterio de San Miguel in Puerto de Santa Maria, and the Hotel Los Angeles in Granada) were obtained within seconds from International Directory Enquiries. None of us speaks Spanish, but everyone we contacted spoke enough English to supply information.

We learned that it was a good idea to call hotels in the evening: often the manager will have left for the day, and you are more likely to be quoted the local price for rooms by the receptionist than by senior personnel, who may give you a different 'international' rate. Late one evening, a receptionist quoted us pounds 49 per night for a double room. Not bad, we thought, particularly since the package price was pounds 104. But when we called the next day to confirm, the manager quoted a 'special price for that time of the year' - so special it was higher, at pounds 66. When I protested, he immediately dropped it to pounds 49, and we booked there and then. At the second hotel we booked rooms at pounds 45 a night against the brochure price of pounds 74.

For car hire companies we didn't need to phone abroad: all the major international companies are represented in the UK, and reservations can be made from the comfort of your armchair (often at little or no cost, via a 'local rate' or free- phone number). We contacted Hertz, Budget, Eurodollar and Europcar. The prices quoted varied widely, some being 64 per cent higher than others, for seemingly no other reason than they could get away with it. Again, we chose the cheapest, at pounds 173 for the week (a saving of pounds 89), which, at Malaga airport, was Hertz.

And, finally, we managed to buy comparable travel insurance over the phone for pounds 12 each, 35 per cent less than that offered in the package deal. Flights and insurance had to be paid for on booking, but for accommodation and car hire no advance was necessary.

This whole process cannot have taken us more than half an hour. The total cost of our holiday for four adults would have been pounds 2,604.75 if I had bought the package. For the same holiday, in the same hotels, on the same B&B basis, using the same rooms and taking the same flights, but with a better class of car, we paid pounds 1,364.50, a saving of pounds 1,240.25.

Granted we were naughty to take advantage of a tour operator's advertising literature to choose our hotels, but tourist information bureaux will send all the details you require (consult the Central London Yellow Pages, under 'Tourist Information Services', or call Directory Enquiries). You can then contact hotels direct, and ask for their own literature, which provides a much better idea of what to expect than standard photographs in a holiday brochure.

It is not, I am bound to say, always possible to make DIY holiday savings. We found it impossible to negotiate even a meagre reduction on a trip to one destination, thanks, I assume, to the power of bulk buying and block booking. Also, our holiday was not of a mass-market type, where cut-throat competition renders potential savings slim. But having said that, friends have succeeded in booking holidays directly, for a saving, following our experience, and we are arranging our trip again this year, at a considerable discount. We are looking forward to enjoying the unspoilt north-west end of Majorca and are paying pounds 1,252 for exactly the same services that are being touted at pounds 2,077. We are saving 36 per cent on accommodation, 60 per cent on flights, 9 per cent on car hire, and 30 per cent on insurance.

If you fancy constructing your own holiday package, it has to be worth a try. What have you to lose but the cost of a few international telephone calls?

The Airfares Guide from Insider Guides Ltd (0392 490909); Travel Deals from Wentworth Publishing Ltd (071-928 9001); International Directory Enquiries (153); Global Flight Check (0295 89471).

(Photographs omitted)