Americans May Put $135 Billion on Credit Cards to Pay for Holiday Travel
The holidays are upon us, and that means you’ll likely be traveling to see friends and family. A recent holiday travel study by NerdWallet found many travelers will be using credit cards to pay for their trips. Here are some of the survey results.
Credit cards are the payment of choice
Many people are turning to plastic to finance their holiday travel plans. Almost half of Americans (49%) said they’ll charge flights and hotels this holiday. So, just how much money do they plan to charge? Roughly 75% said they plan to put some or all the costs on their credit card.
Consumers are spending big bucks on travel
Travelers are putting a significant amount of purchases on their cards. Among those who say they plan to charge their trip, 75% will put roughly $135.8 billion on their cards in total (that’s $1,456 per person).
The bill that won’t go away
It’s easy to charge something on your credit card and forget about it, but it’s not in your best interest to do so. Unless you pay off your purchase right away, it will come back to haunt you. This is especially true when it comes to interest charges.
The NerdWallet study found that on average, Americans took more than two months to pay off their 2017 holiday travel costs. If the same situation happens in 2018, American travelers will shell out a total of roughly $2.8 billion in interest alone in travel costs. About 5% of Americans said they’re still paying for their 2017 holiday travel costs.
What travelers are willing to give up
Some are willing to make a few sacrifices, so they can have what they want. Approximately 36% of respondents said they would skip buying friends and family gifts if they spent a lot of money on travel. About 40% said they would skip holiday travel plans to visit friends and family so they could fund their own summer vacations.
Holiday travel tips
- Use cash whenever you can. Taking a holiday trip to see your friends and family is fun, but you likely won’t be smiling once you receive your credit card bill. Instead of putting every purchase on your credit card, use cash for items such as souvenirs, snacks, and meals.
- Pay off purchases quickly. As you can see from NerdWallet’s study, some travelers are still paying for trips they took one year ago. If you decide to charge your trip, make sure you can afford to pay off the bill within a reasonable amount of time.
- Save for your trip. Set aside money for your holiday trip. This way, you won’t have to rely on credit to be able to afford travel. Roughly 71% said they start saving for holiday flights and hotels about 11 weeks in advance, and some said they purchase flights an average of 7.7 weeks before departure.
Read more: 3 Ways to Save Big Money on Travel Costs
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