Travel is expensive, but it’s still a priority for Americans.
A quarter of Americans would rather skip credit card payments than skip a vacation. That’s according to a new WalletHub survey, which asked 230 respondents in the U.S. about their credit card habits and summer travel plans. It revealed some intriguing insights about the financial priorities of Americans.
Inflation Is Affecting Travel Plans
Everyone knows that summer is one of the busiest times to travel domestically and internationally. And this year, flight prices are soaring due to capacity issues, all while Americans continue to be rattled by the ongoing effects of inflation. So unsurprisingly, 55% of Americans surveyed said that they planned to spend less this year compared to last summer; 68% said that inflation has impacting their travel plans.
Still, a summer vacation is a top priority for many. When asked what they would do for a free summer vacation, 40% of respondents said that they would get an additional job, 37% would stop dining out for a year, and 35% would stop drinking coffee for a year.
Americans Incurring Credit Card Debts
More than 70% of respondents think it’s not a good idea to get a credit card before going on a vacation. But still, 40% think it’s worth it to go into debt for a good vacation. One in four Americans would also skip credit card payments rather than derail their travel plans.
WalletHub Founder and CEO Odysseas Papadimitriou told NBC24 that it’s a red flag for households to accumulate debt for leisure trips and travel should be considered a luxury. There are also cheaper ways to enjoy a vacation, and Papadimitriou says that frame of mine “will liberate so many people to be able to truly enjoy their time off.”
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The survey also found that one in three people still have credit card debt from their last vacation and more than half (65%) think about their post-travel credit card bills while on vacation. Papadimitriou further pointed out that it might not be as relaxing if you’re constantly anxious about money while you’re away–or you’re worried about paying it off once back.
Americans also go into debt when holidays come around to pay for gifts, travels, and festivities. Around 35% of Americans take out loans or accumulate debt for holiday spending, and in 2022, the average debt was around $1,500. In all, Americans have a whooping credit card debt of $1.115 tillions.
Although financial experts discourage going into debt for discretionary expenses, a lot depends on your priorities and your financial situation. Wayne Bechtol, a Senior Tax Accountant at Fiona, told Fodor’s in February, “Some people believe the experiences and memories they gain from travel are worth going into temporary debt. In contrast, some feel it leads to financial stress and long-term consequences. I would suggest that you clear your debts on time, as defaults can erode your credit rating, affecting your ability to get affordable credit when needed.”
Related: Is It Worth Going Into Debt So I Can Travel While I’m Young?