Holiday flight prices: When should I buy my plane ticket and is travel insurance worth it?
The average flight cost may be down, but a new report found inflation and fresh federal student loan payments are causing some Americans concern about holiday travel plans.
If you’re planning a trip, here’s what you need to know about how you can save.
How many people will travel for the holidays this year?
A NerdWallet report found more than 130 million Americans planning to travel for the holidays this year will spend nearly $2,000 on average.
The survey of 2,000 U.S. adults (967 of them plan to travel for the holidays) conducted online by The Harris Poll and analyzed by NerdWallet found 2023 holiday travelers plan to spend $1,947, or nearly $254 billion total.
The report found 75% of holiday travelers will put at least some of their expenses on a credit card. And 8% still haven’t paid off 2022 holiday travel debt.
Assessed credit card interest rates averaged 20.4% at the end of 2022, according to data from the Federal Reserve. As of August 2023, the average assessed rate was 22.77%.
Nearly one-quarter of those who aren’t traveling for the holidays said they can’t afford it, while 35% are traveling as usual despite the cost.
“More Americans are traveling for the holidays this year versus last,” Sally French, a NerdWallet travel expert and spokesperson, said in the report. “That’s despite higher travel costs and other challenges like lingering debt from last year’s travels and resuming federal student loan repayments cutting into budgets.”
Inflation has 28% of travelers worried about the cost to take a trip and 11% are worried about affording travel with student loan payments.
Those loan repayments have been on pause since March 2020, but restarted in October. The median monthly payment before the pause was $222.
How can you save?
The average domestic flight in the second quarter of 2023 is down 5.1% compared to the second quarter of 2022, according to data from the U.S. Bureau of Transportation Statistics. The Consumer Price Index increased 3.7% since September 2022, according to the latest numbers from the Bureau of Labor Statistics.
If you’re booking a flight in mid-December, you can find the lowest average price around 10 weeks before departure, NerdWallet reported.
While it may be too late to save up this year, you can start 2024 by estimating how much you’ll need to travel for the holidays and set aside money each week or month so you’ll be prepared for next year.
Avoiding busy travel days could give you cheaper fares — 35% of travelers are planning to dodge those days by extending their trips, NerdWallet found.
Almost 30% of travelers are cutting back on everyday expenses to prepare and 20% are planning to spend less on gifts to pay for travel instead.
“While holiday travel can feel obligatory, it’s OK to take this year off if it’s going to add stress — or add to your debt,” French said. “And if you do decide to travel, be flexible. Avoid traveling on the busiest days, such as the Sunday after Thanksgiving, for lower airfare prices and reduced airport crowds.”
A report from Hopper, a travel booking app, found departing the week before Thanksgiving or the Monday before will save domestic holiday travelers the most. If you travel on the Sunday after Thanksgiving, you could pay $121 more per ticket than those traveling the following Monday.
In the last three weeks before Thanksgiving, Hopper reported prices will rise by an average of $7 a day and $30 or more per day in the last week.
Around the December holidays, you can save about $114 per ticket by flying on Christmas Eve or Christmas Day, Hopper found. The Friday before and the Tuesday after Christmas will be the most expensive.
If you’re trying to book last minute, you can expect prices to rise by more than $40 per day ahead of Christmas.
Should you get travel insurance?
NerdWallet found trip insurance is more popular this year, with 21% of holiday travelers planning on buying or have bought travel insurance, compared to 16% of last year’s travelers.
If you have a credit card, you should look at your policy details. The best travel credit cards typically offer benefits such as travel accident insurance, luggage insurance, trip delay or cancellation reimbursement, travel emergency assistance, or a claims process, according to a June WalletHub survey.
“Holiday time is inherently a riskier time to travel in terms of weather delays,” French said in NerdWallet’s report. “And given the recent streak of airline fiascos, including the Southwest Airlines meltdown last holiday season, holding travel insurance can be a wise move, especially for trips that are more expensive than what you’d typically book.”
Southwest Airlines canceled thousands of flights across the country last year in a meltdown being investigated by the U.S. Department of Transportation. Sacramento International Airport was among the most heavily affected. Southwest offered 25,000 Rapid Rewards Points to affected passengers.
Reuters reported the airline could be fined or penalized by the Department of Transportation, according to a securities filing, after the department determined Southwest “failed to provide adequate customer service assistance, prompt flight status notifications, and proper and prompt refunds.”
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This story was originally published November 2, 2023 at 9:00 AM with the headline "Holiday flight prices: When should I buy my plane ticket and is travel insurance worth it?."
