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Packages are not guided excursions. Packages combine airfare, accommodations, and perhaps a rental car or other extras (theater tickets, guided excursions, boat trips, reserved entry to popular museums, transit passes), but you are allowed to do your own thing. During busy periods packages may be your only option, as flights and rooms may be sold out otherwise.
Packages will definitely save you time. They can also save you money, particularly in peak seasons, but—and this is a really big "but"—you should price each part of the package separately to be sure. And be aware that prices advertised on websites and in newspapers rarely include service charges or taxes, which can up your costs by hundreds of dollars.
Some packages and cruises are sold only through travel agents. Don't always assume that you can get the best deal by booking everything yourself.
Each year consumers are stranded or lose their money when packagers—even large ones with excellent reputations—go out of business. How can you protect yourself?
First, always pay with a credit card; if you have a problem, your credit-card company may help you resolve it. Second, buy trip insurance that covers default. Third, choose a company that belongs to the United States Tour Operators Association, whose members must set aside funds to cover defaults. Finally, choose a company that also participates in the Tour Operator Program of the American Society of Travel Agents (ASTA), which will act as mediator in any disputes.
You can also check on the tour operator's reputation among travelers by posting an inquiry on one of the Fodors.com forums.
American Society of Travel Agents (703/739–2782. www.travelsense.org.)
United States Tour Operators Association (212/599–6599. www.ustoa.com.)
Local tourism boards can provide information about lesser-known and small-niche operators that sell packages to only a few destinations.