When it feels like the walls of your office are closing in on you, dreaming of the beach or a winding European alleyway can be a nice escape. But what about when it’s time for a real escape?
Everyone deserves a vacation now and again, but a survey conducted by DepositAccounts has found that more than half of millennials skipped taking a vacation this year because they couldn’t afford one. By comparison, only 35% of baby boomers have had to skip a vacation this year due to cost.
DepositAccounts has taken a deep dive into vacation costs and our survey results shed some light on vacation trends amongst Americans of all ages.
- Not being able to afford a vacation has caused 46% of respondents to skip one in the past year. Approximately 55% of millennials and 49% for Gen Xers have not taken a vacation in the last year due to affordability.
- Baby Boomers are faring much better on the vacation front, with just 35% reporting they skipped a vacation this year because they couldn’t afford it.
- Around 66% of Americans wish they could save more for vacations, especially millennials (74%) and Gen Xers (72%). Once again, the baby boomers are struggling less: Only 52% wish they could increase their vacation savings.
- Americans are doing their best to save, about 7 in 10 reported generally saving for vacations.
- How Americans save for vacation varies. One third of survey respondents use a separate account solely for travel. And 23% of respondents take advantage of a dedicated online savings account.
- Ready for some scary numbers? 34% have been in vacation-related debt and 1 in 10 is currently still in debt.
- Many Americans budget in order to make their vacation goals happen. About two-thirds (66%) say they budget for their vacations. But only a little more than half (53%) actually manage to stick to that budget.
- 1 in 5 Americans don’t take any overnight leisure trips each year.
- With limited budgets, approximately 46% of Americans keep their annual vacation spending under $1,000, with only around 16% spending $3,000 or more.
- Cash is king. About 2 in 5 (39%) respondents primarily fund their vacations with cash. On the flip side, 1 in 4 (23%) use credit cards to fund their getaways.
- Why the lack of vacations? 44% of Americans say cost is the most important factor when planning a vacation.
Why do Millennials skip vacations?
Every generation has its own particular quirks and characteristics. But it’s safe to say that everybody enjoys taking a vacation. While you might wonder why millennials are staying home and skipping vacation, the short explanation is: They simply can’t afford it. As discussed above, cost is a major factor that dissuades millennials from planning a great escape. Our survey shows that across all generations, cost is the most important factor when planning a vacation.
Age plays a role in explaining why baby boomers can afford more vacations, as this generation is heading into retirement with home loans likely paid off already. Millennials, meanwhile, are mired in student loan debt, saving for down payments on a mortgage and still working to increase their salaries. This combination of factors contributes to millennials’ struggle to afford vacations. And they’re not very happy about it: 74% of millennials wish they could they could save more money to spend on vacations.
Millennials are doing their best to make their vacation dreams come true. 76% reported saving for vacations and 72% reported budgeting for vacations. Budgeting is wise, as 37% of millennials admitted to having vacation-related debt at one point or another. Which comes as no surprise, as 19% reported using a credit card as the primary source of funding for a vacation. Although it’s worth giving credit where credit is due. Pun intended. Millennials are the least likely generation to fund a vacation by using a credit card. Compare that to nearly 28% of those in the 54 to 72 age range, otherwise known as baby boomers, who are more likely to use a credit card as their primary source of vacation funding.
What does vacation mean for Americans today?
Even when Americans take vacations, they’re frugal about their plans. Of respondents who spend money on vacations, 46% said they spend less than $999, while only 16% reported they spent more than $3,000. These low spending rates make sense when you consider how little money millennials have to play with.
According to a 2019 study from Deloitte, the net worth of Americans ages 18 to 35 has dropped 34% since 1996, with the average millennial net worth capping out at a little less than $8,000. Allocating more money towards vacations may not be possible when there are other large expenses to take care of. Deloitte also found that between 2004 and 2017, student debt has increased for consumers under 30 by 160%.
Despite these seemingly grim numbers, American vacation spending is on the rise. Giving hope that more and more will enjoy a holiday in the sun. In 2017, a study by Allianz Global Assistance USA found that summer vacation spending hit $100 billion for the first time ever. This was the second consecutive year that summer vacation spending rose. In 2016, only $89.9 billion was spent. As of 2019, that number has grown even more, with Americans spending a record $101.7 billion on their 2019 summer vacation(s). Hopefully millennials will find themselves joining in on this vacation boom. A romantic getaway or memory making family vacation can be worth much more than what it cost.
DepositAccounts by LendingTree commissioned Qualtrics to conduct an online survey of 1,035 Americans, with the sample base proportioned to represent the general population. For the purposes of our survey, generations are defined as follows: Members of Gen Z are currently between the ages of 18 to 21, millennials are currently between the ages of 22 and 37, Gen X is between the ages of 38 to 53, baby boomers are 54 to 72, and members of the silent generation are 73 and older. The survey was fielded July 3-5, 2019.