Itching to Travel? Here's How to Avoid Overspending.

Summary

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WSJ Your Money Briefing

Episode Summary: "Itching to Travel? Here's How to Avoid Overspending."

Date: June 11, 2021
Host: Charlie Turner (for The Wall Street Journal)
Guest: Amber Burton, Personal Finance Reporter

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Episode Overview

With pandemic restrictions easing and summer arriving, many Americans find themselves eager to travel—potentially for the first time in over a year. But with rising prices in airfares, rental cars, and hospitality, the urge to escape could lead to overspending. In this episode, Charlie Turner talks with personal finance reporter Amber Burton about practical strategies to keep summer travel affordable, reduce financial regret, and make intentional spending choices.

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Key Discussion Points & Insights

1. Assess Your Financial Situation and Travel Budget

• Start with savings: Amber Burton suggests looking at savings accumulated during the pandemic, including any surplus from cutting back or stimulus payments. But, she cautions, “Be really careful and have a really, really great understanding of how much that is, how much you’re willing to spend and, you know, make sure that you’re not… taking it from your emergency savings.” (02:06)
• Use what’s left—wisely: If there’s money available beyond your essentials, it’s reasonable to put some of it toward a trip, but only after assessing what you’re comfortable parting with.

2. Reality Check: Trade-offs and Setting Priorities

• Weighing vacation vs. other luxuries: Burton says, “There’s nothing that says that you can’t take a vacation right now, even though it’s more expensive. But just be aware of where that money’s coming from and think of it as a trade-off.” (02:59)
  • Example: Sacrifice weekly date nights to budget for a trip, or vice versa.
  • Consider postponing a smaller trip now for a bigger one in the future.

3. Combatting Impulse Booking

• Watch out for pent-up desire: The risk of “impulse booking” is high given the eagerness to get out after a long period of staying home.
• Tactic – The Overnight Test: “Just like you do with your online shopping cart… before you book that plane ticket or hotel stay, do the overnight test. Hold it in that cart, but don’t pay for it for a few days, kind of sleep on it. The more days the better.” (03:59)
• If you still want the experience after waiting, then move ahead and book.

4. Paying for Travel and the Credit Card Trap

• Be cautious with plastic: Many people will want to use travel credit cards to accumulate points, but “if you are unable to… pay it off right away, it’s almost not even worth those points that you’re gaining by going on the trip.” (04:52)
• Best practice: Use credit cards only if you can clear the balance immediately; otherwise, pay with cash or funds on hand to avoid debt.

5. Timing Your Travel for Savings

• Consider off-peak travel: Waiting until fall or midweek for trips can yield significant cost savings.
• Classic advice still holds: “If you go in off season… or in the middle of the week instead of the weekend, you’re going to get a better deal. So the longer you wait, the better.” (05:41)

6. The True Value of Travel: Anticipation and Memories

• Planning and reminiscing matter: Citing behavioral economist Dan Ariely, Burton notes that “what lasts the longest and what has the biggest psychological impact is that anticipation and the memories that come afterwards.” (06:15)
• Anticipation as value: The pleasure of looking forward to a trip can sometimes feel greater than the trip itself.

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Notable Quotes & Memorable Moments

• On safeguarding your financial safety net:

  “Make sure that you’re not putting it, taking it from your emergency savings. You want to keep that built up.” (Amber Burton, 02:06)

• On vacation trade-offs:

  “It’s really adjustable to what you’re looking for and what you value right now.” (Amber Burton, 02:59)

• On controlling impulse:

  “Watch out for that eagerness right now… we are really at risk of making some impulse purchases or in this case, doing some impulse booking.” (Amber Burton, 03:59)

• On credit cards:

  “…if you are unable to this off at the end of the month, turn around and pay it off right away, it’s almost not even worth those points…” (Amber Burton, 04:52)

• On why anticipation matters:

  “Sometimes that [anticipation] has even more psychological benefits… than the trip itself.” (Amber Burton, 06:15)

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Key Timestamps

• [01:34] – Travel prices are soaring—concern about overspending begins
• [02:06] – First cost-saving tip: Assess your pandemic savings
• [02:59] – Making trade-offs and setting priorities
• [03:59] – Impulse booking and the “overnight test”
• [04:52] – How to pay for your trip: Credit cards and cash considerations
• [05:41] – Consider delaying travel for better deals
• [06:15] – Anticipation and memories: The bigger value in travel

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Takeaway

This episode urges listeners to channel excitement for summer travel into smart planning, deliberate spending, and prioritizing financial health. By balancing anticipation with practicality, you can avoid overspending and maximize the psychological benefits of your next adventure.

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Transcript

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[Charlie Turner]

Here's your money briefing for Friday, June 11th. I'm Charlie Turner for the Wall Street Journal sitting in for JR Whalen. With pandemic restrictions being lifted and the weather warming up, the first thing a lot of people want to do is take a trip. But before you do, beware the urge to overspend.

[Amber Burton]

I spoke to a lot of people who said we are really at risk of making some impulse purchases or in this case, doing some impulse booking.

[Charlie Turner]

Coming up, our personal finance reporter Amber Burton joins us with some tips on how to keep your travel costs down when you go away this summer. That's after the break.

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[Charlie Turner]

As Americans start to emerge from the pandemic, people are itching to get out of the house and travel. But as we've talked about on the show before, prices are soaring ahead of the summer travel season. Luckily, there are ways to budget for those higher travel costs. Joining us now with some tips is our personal finance reporter Amber Burton. Amber, thanks for being here.

[Amber Burton]

Thanks for having me.

[Charlie Turner]

So, Amber, it seems like everything travel related is more expensive. Airfares, rental cars, dining. If I want to take a big trip this summer, what's the first cost saving tip that you'd give me?

[Amber Burton]

The first cost saving tip would have to be to look at what you were able to save during the pandemic. There were a lot of people who, if they were fortunate enough to, you know, keep their jobs during the pandemic, they might have saved a lot and put a lot into their savings during this time. And then, you know, a lot of people were really benefiting from the stimulus checks as well. So you might find that you have a little bit of a surplus and you want to use that toward vacation. But be really careful and have a really, really great understanding of how much that is, how much you're willing to spend and, you know, make sure that you're not putting it, taking it from your emergency savings. You want to keep that built up. But if you Have a little bit left over, have a good idea of what it is and utilize that.

[Charlie Turner]

So it sounds like if the money isn't there, you might have to be realistic and maybe even consider some trade offs.

[Amber Burton]

Right. I talked to a couple wonderful financial advisors who were really saying, you know, there's nothing that says that you can't take a vacation right now, even though it's more expensive. But just be aware of, you know, where that money is coming from and think of it as a trade off. So one example that was given was, you know, if you are taking a trip this summer, maybe that means, you know, giving up your weekly date night for the next few months, or if you're finding that you value that more, you know, trade that vacation for those weekly date nights. It's really adjustable to what you're looking for and what you value right now. Another great example was, you know, the trade off of maybe you take a smaller trip now or you skip the smaller trip now and you take a bigger trip next year, maybe an international trip once even more. Countries and places to travel are open

[Charlie Turner]

again for a lot of people. This will be their first trip in more than a year. People have got to be eager to get out. Is that something to watch out for?

[Amber Burton]

Oh, yes, watch out for that eagerness right now. I spoke to a lot of people who said we are really at risk of making some impulse purchases or in this case, doing some impulse booking. So that's the, you know, knee jerk reaction of immediately booking a trip because we want it. We've been inside for most of the year and we want to get out. But one tactic that was suggested was just like you do with your online shopping cart, before you book that plane ticket or book that hotel stay, do the overnight test. So, you know, go ahead and put the details in, hold it in that cart, but don't pay for it for a few days, kind of sleep on it. The more days the better with this sort of test. And if you still want it several days later, then go for it.

[Charlie Turner]

Amber, I guess another key question for those taking a trip this summer is how are they going to pay for it?

[Amber Burton]

Absolutely. The number one question is definitely how are we going to pay for this? And a lot of people, you know, are going to go straight for their credit cards, especially these travel cards, which have points that have been building up. And travel points might be, you know, a great way to go. You know, if you pay on your credit card, you are building those points. But really, really be careful with this because, you know, if you are unable to this off at the end of the month, turn around and pay it off right away. It's almost not even worth those points that you're gaining by going on the trip. So a lot of advisors say, you know, sure, utilize the credit card if you can pay it off right away. Otherwise, work on using cash in money that you know that you have available.

[Charlie Turner]

What about holding off on summer travel, Amber? Would it make sense to wait until fall when prices will likely come down?

[Amber Burton]

And there is nothing wrong with waiting. I mean, you know the old cliche, good things come to those who wait. I spoke to a travel expert over at Homes to Go, the vacation rental company, and they were just saying they're already seeing, you know, the old advice still exists that if you go in off season, you know, off peak, or if you go in the middle of the week instead of the weekend, you're going to get a better deal. So the longer you wait, the better.

[Charlie Turner]

Finally, Amber, you write that the trip itself is only part of the experience and that people should consider the reasons they want to travel.

[Amber Burton]

Yeah, absolutely. I spoke with Dan O'Reilly. He's a professor of psychology and behavioral economics over at Duke University. And he was just saying, you know, for a lot of people, while the trip is a lot of fun, what lasts the longest and what has the biggest psychological impact is that anticipation and the memories that come afterwards. So these two parts often last longer than the actual trip itself. And that anticipation, for instance, we all know it when we plan for a trip, sometimes that has even more psychological benefits, it feels like, than the trip itself. So keeping in mind that, you know, a lot of this is a mental game as well in knowing what we're getting out of it.

[Charlie Turner]

Wall Street Journal personal finance reporter Amber Burton. Thanks for joining us.

[Amber Burton]

Thanks for having me.

[Charlie Turner]

And that's your money briefing. I'm Charlie Turner sitting in for J.R. whalen for the Wall Street Journal.

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