Over the last few years, particularly following the end of the Covid-19 pandemic, the average price of vacations has risen drastically. While there have been a variety of factors that have led to this, including the increased demand for travel, there is no sign that these prices will drop anytime soon. Learning how to build an effective vacation budgeting can help any family or avid traveler find ways to cut costs on their next trip.
How Costly is the Average Vacation?
It’s one thing to constantly hear about news regarding the increase in prices for vacations, but it’s another to actually look at the facts. Over the recent years, the average price for a vacation in the United States has risen to just shy of $2,000 for a single person. The price for two people has risen to just shy of $4,000, which goes to show just how expensive things have become.
The Driving Factors for Hire Prices
While there are a variety of factors that have contributed to the increase in prices for vacations, the most prominent of these include:
- Increased demand resulting from the decline of the Covid-19 pandemic
- Rising food costs as a result of inflation
- Increases transportation costs stemming from rideshare services and other similar platforms
- Increases in accommodation costs amidst an inflationary environment
Building a Vacation Budget: 10 Key Tips to Keep in Mind
Certain areas around the United States will naturally come with a higher price for a vacation, such as taking a trip to New York City. However, alternate, yet equally as fun, locations such as an engaging trip to San Antonio, Texas come at a lower price point. Regardless of where your destination may be, consider each of the following budget tips to cut costs:
- Create a dedicated vacation savings accounts
First and foremost, all avid travelers should have a dedicated savings account set up that maintains a constant supply of travel funds. On a monthly basis, this account should be added to after all bills and other savings have been taken care of. By doing so, an excellent travel nest egg can be developed over time that can go towards trips.
- Set monthly savings goals for your dedicated account
Once you actually have a dedicated savings account setup for your travel funds, you should also set monthly savings goals for the account to ensure you actually add funds to it. Even if this starts off small at just around 5% of your total salary, something is better than nothing.
- Book any and all activities in advance
Many activities will often come at a discount if they are booked far enough in advance of a trip, especially if that booking occurs during the offseason for the location. Consider taking advantage of this if you know exactly what you wish to do on vacation.
- Don’t forget to plan for the smaller expenses
When planning for a vacation, many families often account for major expenses such as food in their budget, but not smaller expenses such as transportation costs. Never forget to account for every single expense you may incur on vacation, especially if money is tight at the moment.
- Consider public transportation options
Taking rideshare services is extremely helpful when on vacation and is often cheaper than renting a car, but it isn’t always cheaper than public transportation. Consider using buses or trains when on vacation to save even more money.
- Think about cooking food instead of eating out
While a major part of going on vacation is enjoying the food that is in the area, this is a major expense. Taking the time to cook your own food instead if you are in a hotel with a kitchenet or a vacation rental can save you hundreds of dollars at a minimum.
- Look into alternative accommodations beyond hotels
On the topic of accommodations, a great way to start saving money on vacations is to choose to stay in alternative accommodations as compared to hotels. Rather than this, consider a vacation rental in which you rent a home for the duration of your stay and gain access to an entire home, as opposed to just a room. While it may sound expensive, you will be able to cook your own food and have your own space which cuts back on costs.
- Outline what your “must haves” are
All families, regardless of budget, have a number of things they absolutely must do on vacation, such as hiring a family photographer in Honolulu. Outline what each of these are for your family members so you know exactly what to fit your budget around when picking your vacation destination.
- Set up notifications for online deals
Temporary deals for activities, hotels, flights, and more are constantly being posted, which is why it’s important to set notifications so that you are alerted when these deals go live. Don’t miss out on a great deal simply because you didn’t activate alerts to your inbox.
- Use credit card reward points whenever applicable
Finally, for avid credit card users, consider using rewards points that you may have earned over time to pay for flights, hotels, or activities through your credit card portal. Alternatively, convert your points to cash back if it’s an option so that you can pay using your points anyways.
The Bottom Line
For avid travelers around the world, rising prices won’t be enough to deter them from taking vacations to unique new spots. However, it’s important not to throw oneself into debt simply out of desire for having a trip on the calendar. The process of saving money for your vacation starts with looking at the average cost associated with a trip, along with its driver factors, in order to determine where costs can be cut. To that end, all travelers should use the above ten tips to cut back on their associated costs when planning the budget for their journey. By doing so, a family can ensure they get a trip on the calendar that will allow them to make memories for years to come.
