Vacation Spending Trends Down

While it is clear that the economic restraints of the recession that began late 2008 are lifting, it may not be moving out as quickly as many experts had hoped. Americans are planning to spend more money in 2014 than they did in 2013, however most of that increase is in necessary categories such as health insurance, rent and utilities. A recent poll suggests that discretionary spending will come in below last year’s numbers for the average American household.

July signals vacation time for many families but this year the travel budget is slim for many and more than 1/3 are planning to seriously tighten the budget. Around 69% indicate that they are planning some type of brief get away but the reality is that 2/3 of those that indicated travel plans are limiting them to day trips or one night stays. For those that are traveling for more than just one night, the expectation is that the cost will be higher than in 2013.

Some experts suggest that it is still too early in recovery to put any real emphasis on spending polls, however others fear that the decline in discretionary spending will inhibit full economic recovery, noting that consumer spending on the “wants” rather than just the “have to” is the lifeblood of a healthy economy.