Despite economic pressures, Americans aren't giving up their summer vacation plans

Even as inflation and financial pressures take a bite out of their budgets, Americans are planning to spend more on summer vacations than ever before, according to new survey data from Allianz Partners USA.

This year’s Vacation Confidence Index reveals that 63 percent of Americans are confident they will take a summer vacation – matching the highest level of vacation optimism recorded by the firm.

Notwithstanding sky-high travel costs and headlines of potential disruptions at airports, summer vacation spending is expected to total $226.6 billion, a 2.26 percent increase over 2024. The average household is projected to spend $2,867.

The upward trajectory continues a six-year trend, with national vacation spend estimates more than doubling since 2019. 

The reverberations of inflation challenges into travel were clear even in October last year, with survey findings showing travelers paring back their holiday getaway plans.

While inflation is certainly a factor, the consistent rise also points to a broader shift in how Americans view travel in their financial planning.

“Despite increased pressure on wallets and ongoing travel cost inflation, we are still seeing Americans prioritize vacations this year,” said Emily Hartman, general manager at Allianz Partners USA. “The ongoing increase in spending signals that Americans view travel as a primary goal when setting up budgets and financial plans.”

Younger Americans are driving much of the momentum. Seventy percent of those under 35 are confident they will take a summer vacation, with the 18-to-34 demographic and families with children showing the highest levels of recent travel.

Gen Z and millennials are also leading the way in luxury experiences, with 31 percent reporting they are investing more in high-end leisure options.

The survey also highlights changing habits. Shorter trips are on the rise, with one- and two-night “micro-cations” becoming more common. Despite being a fairly budget-conscious option, these trips are growing more expensive as well, with the average spend on a one-night vacation rising from $594 to $700.

The trend toward combining work or life events with leisure, often called “bleisure,” is also gaining traction. Thirty-three percent of respondents said they are blending travel purposes this year, a nine-point jump from 2024.

Against a broader backdrop of uncertainty among consumers and businesses, affordability concerns remain. Of those not confident about traveling, nearly 70 percent cited cost as the primary barrier – up from 62 percent last year.

But as they say: when there's a will, there's away. Many respondents in Allianz Partners' survey are finding ways to travel anyway, contributing to what the firm calls a “justi-vacation” mindset.

“This year we saw that at an all-time high with 75 percent of Americans considering annual vacations important to them regardless of their ability to take vacations,” said Daniel Durazo, director of external communications at Allianz Partners USA.