A vacation budget helps you set parameters and expectations to not come home with an unwanted souvenir: debt. Transportation, lodging, food, and entertainment represent just a few of the costs incurred during a vacation. Statistics on the average cost for each category can give you a ballpark estimate to help you start planning a trip. Still, it’s important to remember that vacations are highly variable. The actual cost of a holiday is affected by numerous factors, such as the number of people traveling, the time of year, the distance traveled, and the destination itself.

There are also hidden fees to consider, so it’s wise to add a bit of padding to your final budget. Also, with the COVID-19 pandemic causing disruptions at a moment’s notice, it may be beneficial to purchase travel insurance for your 2021 vacation. 

You’ll also need to keep a close eye on prices that fluctuate significantly according to supply and demand, like transportation and lodging costs. When the pandemic began, prices fell significantly due to widespread travel restrictions and social distancing guidelines. For example, the price of airline tickets dropped by nearly 16% in 2020. Now that COVID-19 immunization rates have increased and travel restrictions are lifting, travel demand is expected to surge in 2021. Expect prices for transportation, lodging, and finite-capacity activities to grow as a result. 

What is the “average” vacation?

As of 2019, about 40% of American families plan at least one vacation per year. Sixty-eight percent of those trips occur in the summer, but domestic tourism remains popular from April through October. Due to increased demand, transportation and lodging costs increase during this time.

According to data from the U.S. Bureau of Labor Statistics’ Consumer Expenditure Survey, an average four-day domestic vacation costs $581, or $144 per day. Transportation represents 38.5% of the total cost of an average vacation, food and entertainment represent 35.6%, and lodging represents 25.8%. For a 12-day international holiday, the average American spends a total of $3,251, or $271 per day. In this scenario, transportation represents 53.9% of the total cost, food and entertainment represent 25%, and lodging represents 21%. 

Other sources, Credit Donkey, suggest that Americans spend $1,145 per person for the average vacation. While the results of a Bankrate survey say that Americans plan to spend over $1,900 on their vacations. 

The Baby Boomer generation spends about $6,600 on vacations each year, on average. Gen X-ers spend about $5,400, and Millennials spend an average of $4,400. According to Travel Agent Central, all in all, the average American spends nearly $2,000 on summer vacations in particular. In 2021, most Americans plan to spend about $737 on their first post-pandemic trip, which will likely be spent visiting family and friends.

Not everyone can afford to travel, but that doesn’t stop some from going on vacation anyway. A 2019 Vrbo survey found that 37% of millennials were willing to go into debt to travel, whereas just 27% of Gen X-ers and 15% of Baby Boomers said the same.

Vacation transportation costs

Simply getting to and from your destination can represent nearly 40% of your vacation’s total expense. You’ll also need to factor in the cost of traveling from the airport, bus station, or train station to your lodging. If you want to hire a taxi, research the destination city’s typical fare charges. 

AAA found that about 53% of American families plan a road trip each year, so travel expenses boil down to gas prices, tolls, and any car maintenance that you perform before hitting the road. But even if you fly to your destination, you might want a car to get around. Kayak estimates that it costs an average of $52 per day to rent a car in the U.S. 

Train travel in the U.S. can cost as little as $7 per ticket to as much as $348, with the average train ticket costing $120. Rail travel is more prevalent in Europe, and prices depend on the length of the trip.

The price of bus tickets also depends on the length of the trip. They average $83 but can cost as much as $425. If you need to hop on a public bus in your destination city, fares are usually around $1.

In 2020, the average cost of a round-trip domestic flight was $302, whereas the average international plane ticket cost $1368. These baseline prices do not include baggage fees or even the cost of parking your car at the airport, which can increase your overall travel costs. 

Cruise fare averages about $160 to $220 per person, per day. However, Tanner Callais of Cruzely.com points out that the pandemic has changed the balance of supply and demand within the cruising industry, which will likely drive prices toward the higher end of that spectrum. 

“During the pandemic, cruise lines have taken the opportunity to scrap older ships,” Callais explains. In addition, “cruise lines have said they plan to return in a staggered approach, with only a few ships at a time and likely with limited capacity to encourage social distancing.” From Callais’ perspective, “The result is likely higher prices until more capacity is added.”

Vacation lodging costs

The typical single-occupancy hotel room in America costs $103 per night. A standard double-occupancy hotel room costs exactly twice that amount: $206. Prices vary in every city and. For example, an average hotel room in Las Vegas costs $127 per night, but the average hotel room in New York City costs $258 per night. Hotel room costs also fluctuate based on consumer demand, so you can expect them to be more expensive during the most popular vacation months and on Fridays and Saturdays.

In comparison, the average AirBnB price in the U.S. is $171 per night as of 2020. However, depending on prices in your destination city, you might end up with a great deal by choosing AirBnB or Vrbo instead of a hotel. For example, the average AirBnB for New York City is $113 per night, but in Las Vegas, AirBnBs cost an average of $164 per night. 

Don’t need any bells and whistles? More affordable options include motels ($45 to $100 per night) and, in certain cities, hostel dorm rooms ($25 – $40 per night). 

If you want to stay in your RV, you’ll still need to factor in campground fees so you can enjoy electricity and plumbing during your vacation. Campground fees in the U.S. range from about $25 to $80 per night. 

International hotel costs also vary significantly from city to city. South American hotels are among the most affordable, with the average Bogotá hotel charging just $47 per night. At the other end of the spectrum is Zurich, where the average hotel costs $255 per night.

Food and entertainment costs

What you do during your vacation also affects your budget. According to a 2014 survey, shopping is the most popular vacation activity among U.S. travelers, with 54% of respondents saying they shop while on vacation. Of course, this activity inherently costs money and can quickly eat into your budget if you’re not careful. Plan in advance how much money you’re willing to spend on souvenirs and the kind of items you’re interested in buying (such as t-shirts, trinkets, local artwork, etc.) to help you avoid spontaneous spending.

Swimming and watersports were the next-most popular activity on the survey. Most summertime destinations have public beaches, but they can get crowded during peak season. You can pay to stay at a resort with a private beach for a quieter, less crowded experience. Such an option can cost anywhere from $144 to over $2,000 per night. And if you want to do anything other than swim, budget for equipment rental fees. For example, you can expect to pay around $500 to rent a jet ski for the day, up to $95 for a windsurfing session, and between $25 and $60 to rent a kayak. 

Tours remain popular vacation activities for about 46% to 49% of U.S. travelers and can include walking, biking, driving, or even hopping on-and-off a bus. Although you can take yourself on a walking tour for free, hiring a guide enhances the experience by providing historical context for everything you see. According to Jacquie Whitt, a tour operator with Adios Adventure Travel, travelers should expect guided tours and activities to be private affairs thanks to the COVID-19 pandemic. While this “will increase costs for solo travelers more than families,” Whitt explains that “both solo travelers and small groups benefit from lots of individual attention, bringing more value to the dollars they spend.” 

According to the U.S. Travel Association, fine dining is the fourth most popular vacation activity among domestic travelers, behind visiting relatives, shopping, and visiting friends. Costs vary from destination to destination and from restaurant to restaurant. Plan ahead by looking up a few local restaurants and evaluating their prices. Do the same for street food vendors, if applicable. Expect to spend $24 to $40 (or more) per person on food, excluding snacks, alcoholic beverages, and tips.

Budgeting tips that can save you more money on a vacation this year

Save money on vacation by planning your full itinerary in advance — right down to the snacks — and then adding a buffer of $100-$200 for surprise expenses. Don’t forget about taxes and gratuities when creating your budget. Try to avoid spontaneity while on your vacation, unless it’s to enjoy a free experience, but carry at least $20 with you at all times.

Not sure where to go? Yulia Saf of MissTourist.com advises tourists to save money by sticking to regional trips rather than cross-country or international excursions. “The new way of traveling on a budget from here on out is regional trips,” which “do not require you to fly or book a travel company.” Saf recommends “glamping, private cabins, or staycation units located outside busy cities” as budget-friendly leisure travel options. 

Saving money on transportation costs

The best way to save money on transportation costs is to avoid peak travel times. Demand is low during January, February, and March because there are no major holidays or school breaks during those months. As a result, you’ll pay less for everything from plane tickets to cruise fares and even train tickets. 

Sometimes flying ends up being cheaper than driving and vice versa. Use a drive-or-fly calculator to help you discover the most affordable option.

If you plan to fly, departing and arriving during the middle of the week will save you money, with Tuesday generally considered the cheapest day to fly. Most travelers prefer the convenience of mid-morning or afternoon flights, so flights that depart at the crack of dawn or in the evening tend to offer the cheapest rates. 

Knowing when to buy your tickets can also lead to savings. For domestic flights, book about two to three months in advance. For international flights, book five to eight months ahead for the best deals. Plane and cruise ticket prices also fluctuate based on the day of the week and even the time of day that you look at them. It’s worth carving out some free time in the middle of the week — especially Thursdays for international flights — at a time when everyone else is busy (think mid-morning or early afternoon) to scout out prices and officially book your trip. Download an app like Priceline, Hopper, or Kiwi to help you monitor fluctuating prices.

Saving money on lodging costs

Hotel prices also vary based on the time of year and day of the week, and “peak season” differs in every destination. For example, warm beaches remain popular in winter, as do ski resorts. Festivals and other significant events can also cause a surge in lodging demand in a particular city. Research your destination ahead of time to discover when tourism slows down, as you’ll be able to nab the cheapest hotel rates for this period.

The cheapest day for hotel check-ins is usually Sunday when most people check out and leave the hotel empty. If you don’t mind taking a gamble, book your hotel room 24 to 48 hours in advance. You can get cheap last-minute deals by filling a room after someone else cancels during their 24-48 hour grace period. Otherwise, book at least one month in advance, especially for popular destinations. 

Saving with rewards cards

Around 26% of travelers say they will use a rewards credit card to save money on an upcoming trip. If you’re not already part of that statistic, start learning more about travel rewards. Credit card rewards from the top airline cards or best hotel cards can be earned on everyday purchases and used to provide real cash value or to earn fun upgrades and perks, like a better seat on your flight. With the right card, your out-of-pocket vacation costs can be significantly reduced.

Bottom line

There are lots of moving parts when it comes to planning a vacation. While budgeting for your next trip may not be a simple task, it can help you avoid debt. So, try and factor in the variety of costs you’ll incur while on the road, like transportation, lodging, food, and entertainment. A ballpark estimate is a great starting point. And don’t forget, there are several fantastic travel rewards cards that you can use to help offset the costs of your next getaway.

Cathy Habas - Contributor

Cathy Habas is a contributor to Million Mile Secrets, he covers topics on points and miles, credit cards, airlines, hotels, and general travel.

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