Inflation shrinks summer vacation budgets for many Americans, survey says

More Americans are planning a summer trip this year compared to last year, but plan to spend less overall, a recent survey said. 

Half of Americans said they would travel this summer, up from 46% last year, according to a Deloitte survey. Much of that activity is still driven by travelers making up for missed trips because of the COVID-19 pandemic, the survey said.

Among Americans who said they put their vacation plans on hold this summer, 50% said that their decision was led by rising costs and financial concerns, Deloitte said. Even among those still venturing out, financial worry is shaping how much they are planning to spend on trips, according to the survey. The average budget for a big trip dropped to $2,930 this year, compared to $3,320 in 2022.  

"Despite rising travel prices, some Americans seem to be making room in their budgets — and suitcases — to discover new places, visit with family and friends, and simply relax away from home," Mike Daher, a vice chair at Deloitte, said in a statement. "With travel sentiment higher than it's been in years, air travel continues to soar, driven by the excitement of international travel. 

"However, with travelers planning more trips this summer, they're being cost conscious and making those marquee trips less extensive," Daher continued. "This could signal a call to travel providers to pack both quality and value into their offerings."

If you are struggling with high inflation, you could consider taking out a personal loan to pay down debt at a lower interest rate, reducing your monthly payments. Visit Credible to find your personalized interest rate without affecting your credit score.

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Gas prices expected to be better this summer, analyst says

Memorial Day kicked off what is typically a volatile season for gas prices, according to GasBuddy.

"As we look into the state-by-state price movements, there are some states seeing a big increase, and there are some states a little bit of a decrease, so it's kind of a mixed bag," GasBuddy's head of petroleum analysis Patrick De Haan said in a recent podcast.

However, the good news is that prices are well below where they were this time last summer, De Haan noted. 

"All in all, it's good news this summer; gas prices are likely to stay quite a bit below last year," De Haan said. "For those that remember 2022, the national average peaked at $5.03 a gallon, that was in mid-June. We could be over $1.50 lower at some point this summer, but there are some caveats. Hurricane season is just a couple of weeks away, and if we get hit with a major hurricane in the South, that could push prices up. The economy as well is a bellwether, and we could see prices perking up if the economy improves over the course of the summer."

Despite the dip in gas prices, only 53% of Americans said they planned a road trip this summer, compared to 64% in 2022, according to the Deloitte survey. 

One way to save on summer expenses is by lowering the amount you save on car costs. If you are looking to save money on your car costs, you could consider changing your auto insurance provider to get a lower monthly rate. You can visit Credible to shop around and find your personalized premium without affecting your credit score.

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Here's how to keep from going over budget on summer plans

Inflation and rising costs have pushed Americans to increasingly lean on credit to make ends meet. Total household debt increased to $17.05 trillion in the first quarter of 2023, growing $148 billion or 0.9% from the fourth quarter of last year, according to the latest data by the New York Fed. 

Americans who are still choosing to vacation can take these steps to save for their summer holiday, according to Citizens Bank:

Open a vacation savings account

Saving to an account dedicated to your vacation budget is one way to build funds and stay out of debt when you are ready for your trip. 

"One great way to add to your vacation savings is to sign up for automatic deductions from your checking account," Citizens said. "Each time you get paid, you can allocate a certain amount of dollars to go straight into this account, but make sure to be realistic about the amount you allocate so you don't need to use these funds until you're ready."

Spend less on eating out

Americans spend roughly $8,000 annually on dining out and groceries, Citizens reported, citing the U.S. Bureau of Labor Statistics (BLS). That money could be used to build your vacation savings, according to Citizens. 

"You don't have to eliminate restaurants completely, but making more meals at home is one of the fastest ways to reduce your monthly spending," Citizens said. 

Save on car insurance and cable TV service

Many Americans might be able to save on their car insurance, cable TV, or cell phone service, according to Citizens. 

"Call your providers and see if you're eligible for any discounts or promotions," Citizens said. "Also, consider getting quotes from other providers who could give you service at a lower cost."

If you are looking to cut costs and want to save money, you could consider finding a new auto insurance provider to lower your monthly premium. You can visit Credible to compare multiple car insurance providers at once and choose the one with the best rate for you.

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