Each year, summer brings another opportunity for vacation — a trip to the water park with the family, attending a wedding in another city or taking a solo hike at the park across state lines. As important as these summer traditions are, the reality is that travel expenses are now a big factor when planning. This year, inflation costs are squeezing household budgets tighter than they have in decades. The question may not be where to go on vacation, but rather which vacation spots offer the best value for your money.
COVID restrictions have lifted substantially across the globe, yet financial restrictions are now limiting where passengers might consider traveling. The consumer price index showed a 9.1% increase in the cost of goods and services in June 2022 compared to one year prior. The category with the largest increase in a year was motor fuel (which includes all types of gasoline), which increased by 60 percent. This increase directly impacts the cost of summer travel plans, forcing consumers to decide if they can even afford to go on vacation and if so, is it cheaper to fly or drive? Bankrate took a closer look at the cost of flying versus driving in 2022 to help you solidify your travel plans.
Travel expenses statistics
- 41% of American travelers now say rising gas prices will greatly impact their decision to travel in the next six months (S. Travel Association Monthly Travel ReportMay 2022, US Travel)
- 69% of consumers surveyed said they are making some sort of travel plan changes due to rising inflation. (Bankrate Summer Vacation SurveyApril 2022, Bankrate)
- Taking fewer trips and traveling shorter distances are the most common changes people are making to their summer travel plans. (Bank rate)
- The Travel Price Index (TPI) is higher than the Consumer Price Index (CPI), 17.5% versus 9.1% in June 2022, compared to the previous year. (S. Travel Association Travel Price IndexTPI June 2022)
- The TPI is up 21% compared to June 2019 and the CPI has similarly increased 15.7%, further indicating increased travel costs are outpacing other consumer prices. (TPI June 2022)
- Airfare costs are up 34% YOY compared to June 2021 and up 22% compared to June 2019. (TPI June 2022)
- Hotel prices increased 11.5% in June 2022, compared to June 2021. The price increased 9.5% compared to June 2019. (TPI June 2022)
- Beaches are the number one destination among those consumers surveyed who are planning to vacation this summer, with 37% of respondents choosing this destination. (Bank rate)
- Cruises and international travel were the least popular destinations, among those surveyed. 11% and 12% respectively were likely to choose these options. (Bank rate)
- Airfare costs showed a slight decline in June 2022 versus May 2022, with a -1.8% decrease. Lodging costs also showed a slight decline within the same period, with a -3.3% decrease. (TPI June 2022)
How much is a plane ticket?
Before booking summer travel plans, many consumers are comparing the cost of flying versus the cost of driving to a destination. Since fuel costs impact both modes of transportation so heavily, comparing the costs during this time of inflation has become an essential aspect of budgeting for travel.
In June 2022, the average cost of a domestic plane ticket across all US cities was $330, according to the Federal Reserve of St. Louis, which tracks the average costs of plane tickets. For international travel, the average cost of an international ticket flying out of the US was $981 round-trip in July 2022, according to data published by Hopper.
The airport you fly out of has a major impact on the price you pay for a plane ticket, too. These price variations from airport to airport are based on a number of factors, including how many airlines serve the airport and the amount of demand in that particular city. This table below, with data compiled by Bankrate, shows the price variations among the top ten busiest airports in the US
|Los Angeles (LAX)||$350.25|
If one of your top questions in travel planning this summer is “how much is a plane ticket?”, you may want to consider comparing prices for multiple airports if it is possible to fly out of another location. Booking ahead as much as possible and setting up price alerts are other ways to potentially save on airline tickets. Another strategy may be to sign up for a travel rewards credit card where you can take advantage of sign-up bonuses and earn points towards travel expenses, like airfare and hotel.
How high will gas prices go?
The average cost of gas across the US is $4.35 per gallon, according to the latest data from AAA. Like airfare costs, gas prices are higher or lower based on location. These regional differences in price are due to multiple factors, including distance from the gas supply, the number of retail gas station locations and any supply disruptions a particular region might experience.
In June 2022, the average price of regular gasoline was $4.93 per gallon, according to the US Energy Information Administration. Regionally speaking, the lower Atlantic (the Southeastern states) averaged $4.60 per gallon, while the West Coast averaged a staggering $5.81 per gallon. New England and the Central Atlantic states averaged around $4.90 per gallon and the Midwest was slightly lower at $4.87 per gallon. The Rocky Mountain states, including Colorado, Idaho, Montana, Utah and Wyoming, also averaged $4.90 per gallon. The Gulf Coast states had the lowest average at $4.54 per gallon.
Keep this in mind when planning your road trip travels:
- Typically, states in the Southeast and Midwest pay the least for gas on average, with Mississippi, Oklahoma and Texas typically paying the least. (Bank rateGas Prices 2022)
- California, Hawaii and Nevada usually hold the top spots for highest amount per gallon, on average. (Bank rate)
- Gas prices can change from ZIP code to ZIP code, too. (Bank rate)
Because gas prices change daily and can vary significantly by simply crossing state lines, using a road trip gas calculator for trip-planning is helpful for comparing costs. Plugging in to and from locations for your vehicle can give you a realistic estimate of how much driving will cost. For example, driving from Atlanta, GA to Memphis, TN costs about $121 for fuel for the 400-mile trip. The distance from Atlanta to Raleigh, NC is about the same, and would cost $126 in fuel. Orlando, FL is about 430 miles from Atlanta, and would cost about $136 in fuel.
Picking the right vacation spots
No one knows how high gas prices will go, but one thing a consumer does have control over is choosing a more cost-effective spot for travel. When planning a trip, it is helpful to break down the costs for each of the following categories.
Rental car costs
- New cars are up 11% in June 2022 versus a year ago. This makes it more expensive for rental car companies to purchase new vehicles to fill up inventory, which in turn makes renting a car more expensive. (Bureau of Labor Statistics)
- The average rental car cost is around $81 per day, a significant increase compared to the $35 per day average in 2019. (CarScoops.com)
- The average cost to rent through a car sharing service like Turo is $72 per day. (Automoblog.net)
Trip mileage and gas prices
- When researching which state has the highest gas prices, keep in mind driving from California will be the most expensive, since the current average per gallon in this state is $5.73. (AAA Gas Prices)
- The least expensive state in the country for gas right now is South Carolina, with an average of $3.86 per gallon. (AAA)
- Consumers have been wondering when gas prices will go back down. The good news is, the short-term trend shows prices are decreasing. The national average is $4.35 per gallon, but the highest recorded average was $5.01 on June 14, 2022. (AAA)
Plane tickets and airfare
- Global demand for air travel is up to about 80% in 2022. (International Air Transport Association)
- The $981 average in June 2022 for international travel from the US is an 8% decrease in cost from the previous month. (Hopper)
- A similar trend was seen with domestic flights, with the $339 average in June about 11% less than the previous month. (Hopper)
- Hotels are currently experiencing all-time high room rates, which is important to factor into the cost of a trip. (STR US Hotel PerformanceApril 2022)
- Hotels are operating at about a 65% occupancy rate, the highest level since July 2021. (STR)
- Hotels in Miami are experiencing the highest room occupancy rate, currently at 80%. (STR)
Cost of living in the destination city
- Food prices continue to rise too, with the price of food away from home increasing 7.7% in June 2022 compared to June 2021.
- Alcohol consumption away from home is up 5.5% in June 2022, compared to a year ago.
- Total food and beverage costs are up over 7.5% in June 2022 compared to last year. Consumers can look for ways to get creative with meals, including sharing plates, packing meals from home and researching specials around town.
Road trip safety
With a trend in slightly decreasing gas prices, there may be more consumers looking to hit the road versus flying somewhere. If driving is the preferred route, be sure to keep the following risks in mind, so you can plan ahead and perhaps lessen some of the risks.
- Of the three summer months, August has the highest average of fatal car crashes. (Bank rate)
- The most dangerous day to drive is Friday between 3 pm and 5:59 pm (NHTSA)
- The least busy times are typically the weekdays between Monday and Thursday in the early morning hours, which could be beneficial for planning to travel on the road with the family.
- Driving your own vehicle is not the only form of transportation available. Public transportation, like trains and subways, or rideshare services are a great way to save on costs and avoid congested roads.
- If you do take your own vehicle on the road this summer, it’s an ideal time to review your auto insurance policy — possibly even comparing quotes from multiple car insurance companies or making changes to current coverage for added savings.