Americans Spending Less on Vacations This Summer

May 27 2004 - Two new vacation surveys show that the average American is planning to spend 5.3 percent less this year on summer vacations and the vacation is more likely to be taken in the US. In its annual study, Myvesta - a nonprofit consumer education organization - found that the average summer vacation will cost $2,252 this year, down from $2,378 in 2003.

"While we have seen a slight rebound in our economy over the past few months, there hasn't been a big enough surge to give people the confidence to spend more on their summer getaways," said Pam Rhode, president of Myvesta. "People who are taking trips are looking for more value and a lower price tag."

Over three-quarters (77.8%) of those taking a vacation intend to use a credit card to pay for all, or part of their trip. 29.3% plan on taking three or more months to pay for their vacation charges. Myvesta calculate that if the average vacation cost of $2,252 is placed on a credit card and only the minimum payment is made, it will take almost 33 years to pay off the balance and cost an additional $5,687 in interest payments. Their calculation assumes an 18% interest rate and a monthly minimum payment of 2%.

"Everyone needs a break from time to time, and it can be very tempting to pull out the plastic to finance a vacation," Rhode said. "But one week of fun in the sun isn't worth 30 years of debt payments."

Of the 100 people in the random telephone survey, 41% planned on taking a trip this summer - compared with 48.5% in 2003. 53.6% of Americans said they were not taking a summer vacation while 5.4% were undecided.

People in the West planned to spend the most on their summer vacations with an average of $2,566. Northeast residents were a close second with an average of $2,405. Respondents in the South planned on spending $2,199 and people in the Midwest planned on spending $1,802.

Meanwhile, the Yesawich, Pepperdine Brown & Russell/Yankelovich Partners 2004 National Travel Monitor indicated that demand for both leisure and business travel services was likely to grow in the months ahead. Main findings in the survey of 1,350 active leisure travelers included:

* A third (33%) of leisure travelers expected to take more trips this year compared to 2003, while 38% expected to take the same, and 29% expected to take fewer.

* Among the 29% of leisure travelers expecting to take fewer trips, the most frequently cited reason was that "current economic conditions make it difficult for me to travel". Fear of flying was cited by only 5%, and the "hassle factor" of travel was cited by only 6%.

* Confirming the financial strain felt by many U.S. households, a mere 18% of leisure travelers stated they "would be willing to trade an increase in pay for an increase in vacation time," down from 29% in 2003.

* Vacations continue to get shorter, with 59% of all vacations taken by Americans lasting four nights or less (including a Saturday night), up 5% over 2003.

* Interest in international travel declined for the most popular destinations including Western Europe (-6%), the Caribbean (-3%), Canada (-4%) and the Far East (-3%).

* Interest in visiting domestic destinations increased significantly for Hawaii (+5%) and Nevada (+3%). Florida, California, New York and Colorado were also rated among the top five domestic destinations for American travelers.

* 23% of active leisure travelers regularly use the services of a travel agent (the same percentage as last year). The comparable number for airline and hotel users was 36%.

* Utilization of the Internet continued to grow. 63% of active leisure travelers consulted websites to plan vacations (up from 57% in 2003), and 45% actually used the medium to book reservations (up from 38% in 2003).

* The Internet is now the information source used by the majority of Americans when planning a vacation (51%).

Myvesta(SM) 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.

Yesawich, Pepperdine, Brown & Russell is a leading marketing, advertising and public relations agency specializing in serving travel industry clients. The company's offices in Orlando, New York, Honolulu, Los Angeles, London, Sao Paulo and Zurich serve clients worldwide.