Summer travel is heating up with the weather, but consumers are weary about spending too much. Nearly 71% of consumers blame inflation for impacting their road trip plans, an Experian survey found.
A majority of survey respondents planned to spend an average of $1,000 on their trips this summer. Road trippers plan to spend the most on gas and accommodations.
Auto insurance rates are also impacting travelers. Three out of four respondents to Experian’s survey are worried their rates will increase in the next year. This concern that rates will rise is causing a third of respondents to shop around for auto insurance.
States with higher insurance rates have the highest percentage of drivers looking to switch. About 14% of drivers looking to switch live in Texas and 11% live in Florida.
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Most travelers don’t plan to use cash to pay for their traveling this summer. Credit cards are the most preferred method of payment, according to a PYMNTS study.
About 69% of those planning to travel will use their credit cards for at least part of their accommodations. The rewards and cash back programs offered through their credit cards are the most popular reason consumers choose credit cards over other payment methods. Cash flow management and accessibility are two other major reasons travelers opt for credit cards.
While a majority of travelers choose credit cards, 59% use debit cards and 57% choose cash to pay for their travels.
PYMNT’s data also focused on the financial picture of travelers. Higher credit scores indicate a higher inclination to travel. About 57% of high credit borrowers have summer travel plans, slightly higher than the 51% of those with mid-level scores or low credit scores.
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Travelers from all generations are attempting to be more frugal with their travel plans this summer, but millennials and Gen Z are more willing to spend in one area: live events. Gen Zers in particular are willing to splurge on concerts, sporting events and other live events, a AAA and Bread Financial report found.
About 65% of Gen Zers and 58% of millennials have or plan to travel within the next 12 months for in-person entertainment that is at least 50 miles from home, signaling a willingness to spend extra on travel. Just 43% of Gen X and 27% of baby boomers are willing to do the same.
Many Gen Zers are even willing to travel more than 1,500 miles to attend these events. Twice as many Gen Zers in the study said that they’d be willing to travel this far, compared to just 9% of baby boomers.
"Younger generations are leading the charge when it comes to a shift in consumer spending habits surrounding live event travel," Paula Twidale, senior vice president of AAA Travel explained. "Gen Z and Millennial travelers are taking their trips to the next level by going farther and spending more than other generations for live events. They don’t want to miss out and will do what it takes to see their favorite artist, sports team, or other live event in person," said Twidale.
Not only are younger generations willing to shell out more money for travel, but also for the tickets themselves. About two in five Gen Zers and millennial travelers paid between $500 and $5,000+ for just tickets. Dipping into savings is no problem for these generations when it comes to live events in particular. Some would even consider taking on a side hustle to pay for any concerts or shows they’re interested in.
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