Americans Spending Less On Summer Vacation
Average cost of summer vacation down 31 percent
For Immediate Release: June 6, 2002
ROCKVILLE, Md. — Americans are cutting back on summer vacation spending this year by 31 percent. According to the annual Summer Vacation Survey by Myvesta, the nation's only financial health center, the average summer vacation this year will cost $2,172. That amount is down from $3,155 in 2001 and $2,274 in 2000.
"We've seen people cut back on their traveling ever since the events of September 11, and this survey shows that those trends will continue through the summer," said Steve Rhode, president and co-founder of Myvesta. "Many people are looking closer to home for their summer trips, so there are less expenses like airfare and hotels."
Of those taking a trip this season, 76 percent plan on using a credit card to pay for it. Almost half of those people plan on paying off the balance in full when the credit card bill arrives, but 27 percent will spread their payments out over three months or more.
"Using credit to pay for your vacation can be a smart move," Rhode said. "You get protection on your purchases, rental car insurance may be included and you don't have to walk around with a lot of cash. Just make sure you pay off the balance as soon as possible. We see people continuously who charge large amounts on their cards with the best intentions of paying them off, only to end up stretching their payments out over time. If you're not diligent about paying off that balance it's easy to continue paying for this year's trip for 20 or 30 years."
By charging the average cost of this year's vacation and making only the minimum payments, it will take more than 32 years to pay off and cost an additional $5,447 in interest payments. That calculation uses an 18 percent interest rate and a 2 percent minimum monthly payment.
"Vacation spending is part of the trifecta of debt which includes back-to-school and holiday shopping," Rhode said. "People who overspend on their vacations are in for rough times when the back-to-school season starts."
Myvesta used an outside research firm to survey 1,000 random U.S. adults from May 31 through June 2.
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MyvestaSM is dedicated to helping people create healthy financial lives. The organization provides a wide range of materials to inspire and inform people so that they can break down their barriers to financial and personal success. For more information visit Myvesta.org online.
