- Many millennials and Gen Zers are taking on debt to finance their summer travel plans.
- Post-pandemic travel is booming despite inflation.
- Experts say remote working and “leisure travel” have increased spending on travel experiences.
Young Americans are having the summer of their dreams – just don’t ask to see their bank balances.
A Forbes Advisor survey of 1,000 Americans planning to travel in 2024 showed that the post-pandemic boom in “revenge travel” is in full force, despite rising inflation.
An estimated 92% of respondents said they plan to travel as much as they did in 2023, and more than half of Gen Z and millennials surveyed said they plan to travel more.
Millennials and Gen Z are even willing to take on debt to finance their summer travel, according to three new surveys from Credit Karma, Bankrate and Bank of America cited in a recent Business Insider report.
“Now that travel is back, young travelers want to make the most of the time they have and prioritize spending on experiences over tangible objects,” Trivago CEO Johannes Thomas told BI.
These statistics did not surprise Thomas, who told BI that this new trend could be partly attributed to the rise of remote work.
To work from home – or abroad
In a recent survey released by BI in April, 34% of U.S. CEOs said they expected employees whose roles were once office-bound to be back in their daily commute five days a week during of the next three years. That’s down from 62% who held this view in 2023, according to the survey. study published Thursday by KPMG USA.
“Remote work and flexibility are the new norm,” Thomas said, adding that taking vacations while working has become easier for young people entering the workforce.
The ability to work from anywhere is appealing to those looking to fit more travel into their schedule, regardless of their bank balance.
It may be simpler, but that doesn’t necessarily mean cheaper. About 62% of millennials and 61% of Gen Zers surveyed by Forbes Advisor said they plan to spend at least $4,000 on travel in 2024.
Ivan Saprov, founder and CEO of Voyagu, told BI that the rise of bleisure travel has encouraged young people to prioritize travel during times of economic uncertainty.
For example, he said the growing combination of hotel chains and coworking spaces has made it “convenient for young professionals to work remotely while traveling.”
“With the rise of remote and hybrid work formats, it’s now easier than ever to combine work with pleasure,” Saprov said.
Revenge trips and other loans
It’s not just remote and hybrid working that may have contributed to an increase in travel spending.
Travel experts previously told BI they had noticed an increase in customers opting for luxury air travel experiences, from private jets to first class and premium class plane tickets.
Oliver Bell, co-founder of luxury travel company Oliver’s Travels, said the trend could be partly attributed to “revenge journey” where people are “willing to spend more on incredible experiences” in the wake of the pandemic.
Social media can also play a role. Thomas and financial expert Julie Beckham told BI that young people are likely to be influenced by their peers who showcase their travel experiences online.
“FOMO (or fear of missing out) has a lot to do with saying yes to trips we can’t afford,” said Beckham, assistant vice president/head of financial education development and strategy at Rockland Trust.
“We’re very uncomfortable talking about finances as a society and this can lead to people overspending on keeping up with their friends or social media appearances,” she added.
Debt is also a burden that many people are used to carrying. According to data from Experian, the average American owes $104,215 in mortgages, home equity lines of credit, car loans, credit card debt, student debt and other debts such as personal loans.
Of course, you don’t have to sacrifice financial stability to travel if it’s within your means.
Beckham recommends creating an international spending plan for future trips.
She said it pays to be open and honest with your travel companions about your budget expectations so you can plan for cheaper alternatives if necessary.
“It’s much nicer to save up for a year to go on vacation than to go and spend the next year paying for that vacation plus interest,” Beckham said.
“As much as possible, avoid the temptation to just charge it and deal with it later. As your tan fades, your debt will increase, as will your stress.”
