Your summer vacation will still be expensive this year. But there are ways to cut costs.
While overall inflation has eased, the costs of traveling remain far higher than they were pre-pandemic. Because of that, 80% of likely travelers are changing their summer vacation plans.
If you’re planning a summer vacation this year, you’ve probably already felt some sticker shock.
While overall inflation has eased, the costs of traveling remain far higher than they were pre-pandemic.
And would-be vacationers are responding: 80% of likely travelers are changing their plans because of increased costs, according to a recent Bankrate survey.
About a quarter of those surveyed said they were choosing less-expensive destinations, hotels, or Airbnbs; doing cheaper activities while on vacation; driving instead of flying; traveling for fewer days; or taking fewer trips.
“It surprised me how robust travel demand has been,” despite high prices and recession fears, said Ted Rossman, Bankrate senior industry analyst. A combination of factors may be at play, he said, including an increased desire to travel post-pandemic and Gen Z and millennials’ prioritization of experiences — and sharing those experiences on social media.
But while people still want to travel, “they’re willing to make some trade-offs,” he said. “They’re willing to cut some corners to save money.”
Here’s what to expect this summer, and some ways you can save while still enjoying your travels.
Where prices stand now
Airfare: Expect to pay slightly less than you paid last year, given that fares are down 0.9% compared to last year, according to the latest Consumer Price Index (CPI). But if you haven’t flown since before the pandemic, you’ll likely pay more than you did last time. Airfare has increased nearly 10% over the past four years.
Hotels: Expect to pay slightly more than you paid last year. The CPI’s “lodging away from home” category, which includes hotels, motels, and vacation rentals, has increased 3.3% since 2022. If it’s been a bit since you last booked a room, the jump will be higher: Lodging has increased about 24% over the past two years.
Eating out: Dining away from home costs almost 9% more than it did last year, and 24% more than in April 2019, pre-COVID.
Driving: Whether you’re driving yourself or renting a car, expect prices to be less than they were this time last year, but far higher than they were a few years ago. The price of gas and the cost of rental cars and trucks are down 12% and 11%, respectively, compared to last spring. But keep in mind the gas price decrease still hasn’t made up for a nearly 44% increase the year prior, and rental car and truck prices nearly doubled at the beginning of the pandemic.
Ways to save
“A lot of it comes down to zigging when others zag,” Rossman said. “Maybe going somewhere in the offseason or shoulder season. And just being flexible with your dates or your destination.”
Rossman suggests the following:
Shop around for deals: If staying within budget is top priority, perhaps prioritize a good deal over a specific destination. Price out stays in different beach towns, mountain areas, or cities, depending on your preference. “So often people get their hearts set on a specific place at a specific time,” he said, “and that makes it difficult to save because you’re kind of boxed in.”
Think about traveling in the offseason: Prices for lodging and flights can be much cheaper outside of the prime season, if you can be flexible about the dates of your trip. Shore real estate agents, for example, said short-term rentals can be as much as 50% cheaper in early June compared to July or August.
Travel midweek: Hotels and flights tend to be more expensive on and around the weekends. Depending on the situation, traveling midweek could save you hundreds of dollars, he said.
Investigate credit card rewards, gift cards: See if you’re sitting on any unused credit card rewards or miles, and look around for any old and unused gift cards to defray costs. If you don’t have a travel credit card, it’s likely too late to reap any benefits this summer, Rossman said. But if you know you can pay off the balance each month (and therefore not have to pay high interest rates), it may be worth opening one to save on later trips.
Think about ride-sharing instead of a rental car: Rental car prices skyrocketed at the start of the pandemic, and they continue to be a large chunk of people’s total vacation bill, Rossman said. His family sometimes uses Turo, a car-sharing service where people rent out their private vehicles, which can be cheaper than traditional car rental companies. You should also price out the cost of using rideshares such as Uber or Lyft, he said, and think about whether you need the car for the entirety of your trip. If you have multiple children, car seat rental fees can also add up in rental cars; bringing your own or buying a cheap one at your destination could be worthwhile, he said, depending on the length of the trip.
Consider a staycation: If you realize you really can’t swing a vacation away this year, take your paid time off anyway, and make some plans locally, allowing yourself to unplug from work without going into debt.