How Will We Vacation This Year?

By Len Hayduchok, CFP®

Summer fun, the longer days and warmer evenings, as well as vacation for our school-age children, means we’re all feeling ripe for a little extra adventure. In the recent turbulence of Covid, not to mention the tumultuous economic environment, we’ve shifted here and there, including whether we vacation (as well as how). Let’s look at the forecast for this year’s summer plans.

A Forbes survey asks, “How much will you travel this summer?”

• 52% of consumers said they plan to travel the same amount as they did in 2023.
• Another 40% of respondents expect to travel even more.
• For reference, Americans averaged 2.1 trips for the 2023 year. (36% of respondents traveled 3+ times for leisure reasons.)

So what will our vacations look like in 2024? Almost half of us plan our trips to see family and friends (46%), while trips to the beach (36%) and road tripping (34%) are other popular choices

Going into these plans, the survey considers, “What will you spend?”

• 72% of survey respondents plan to spend over $2,000 on travel in 2024 , with nearly half (48%) planning to spend over $4,000.
• 39% of respondents share that their budget is higher (compared to 45% last year).
• Another 35% will budget the same amount, despite the pressures of inflation straining both household and discretionary spending.

Perhaps that trend to cap spending by adjusting our plans and expectations is here to stay (for the forseeable future). Of all the travelers surveyed, nearly half (46%) are somewhat or very likely to shift plans in one way or another due to inflation. Of these respondents, 19% expect to take fewer trips while 14% will shorten the duration of one or more of their intended trips. Respondents shared their savings strategies:

• opting to drive instead of fly (18%),
• scheduling off-season travel rather than peak (14%),
• targeting less costly destinations (14%) or
• booking less luxurious accommodations (12%)

When we look at a larger snapshot, there are a few trends to note. In order to pay for a summer vacation, 36% of us are willing to take on debt whether it’s borrowing from family/friends, taking a personal loan, carrying a balance on a credit card or using buy now, pay later services. Over half of those not planning to vacation at all (66%) say it’s because they can’t afford it.

As we weigh the priority we place on vacation (even if it means taking on debt), a few trends emerge. Overall, young people are also more willing to take on debt to pay for their 2024 summer vacation:

• Boomers: 22%
• Gen Z: 42%
• Gen X: 31%
• Millennials: 47%

As you plan how to spend this sunny season, be sure to weigh all the pros and cons (remembering any personal weaknesses you may have when it comes to spending / savings). Are you the type of person who spends very freely, more happy to enjoy today and deal with the consequences later? If so, take some extra time to budget and consider how your spending on something as big as a trip could effect you in the long-term. Perhaps just adjusting your spending plan to a minimized budget will help you keep the fun, without derailing your financial health. On other hand, are you the type who prefers to save and plan, perhaps at the expense of relationships and well being? There are wonderful benefits to being active with friends and family, as well as developing a bucket list and enjoying the benefits of ticking goals off. Why not consider, within a comfortable budget, what activities would add to your mental, social/emotional, and physical health this summer, rather than not doing anything at all!

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Len founded Dedicated Financial (DFS) to help retirees and pre-retirees on their financial journey. As a frequent contributor to some of the industries most well trusted publications, Len continues to offer his insight and knowledge on how to redefine retirement in our culture, and the role money plays in people’s lives.

As an OLLI instructor with UDel, as well as a Certified Life Coach, Len developed The MaxAMAZING™ Your Retirement Life/Money System to help retirees flourish.

DFS is a full-service financial planning firm. “Our holistic approach gives clients a greater confidence that they, and those they care about, will benefit from their wealth in the most meaningful way. Our Life/Money System^™ helps us align your resources with what matters most to you.“

SOURCES: 40% of Americans Plan to Travel More in 2024 vs. 2023 | More than 1 in 3 American travelers plan to go into debt for their summer vacations this year.