6 Ways to Save Money on Holiday Travel
Of Americans who plan to put 2021 holiday travel expenses on a credit card, the average they plan to charge is $1,471, a September 2021 NerdWallet survey found. That’s a...
Of Americans who plan to put 2021 holiday travel expenses on a credit card, the average they plan to charge is $1,471, a September 2021 NerdWallet survey found.
That’s a lot of money to spend on flights and hotels, especially when you consider that only 21% of those surveyed say they’ll pay it off in the first statement. This data is according to an online survey commissioned by NerdWallet and conducted by The Harris Poll of more than 2,000 U.S. adults 18 and older, among whom 780 (38.5%) plan to spend money on flights/hotel stays during the 2021 holiday season.
How can you minimize those costs if you’re traveling somewhere by plane? Here are six ways you can save money on holiday travel.
1. Use miles or points for flights
During the COVID-19 pandemic, many airlines loosened their change and cancellation policies, especially for bookings paid in cash. Nonetheless, if you need to cancel and rebook, you will have to pay the fare difference if the price of the flight increases.
However, when you book a flight with miles on an airline with an award chart, you might not end up paying extra miles. In this case, the cost is based on the category, not the dollar value of the flight ticket. So even if you make a last-minute change, the price in miles on both tickets may be the same.
There are a few exceptions. On some airlines, like Southwest, Delta or JetBlue, the number of miles needed for an award flight are directly linked to the cash cost and demand of the ticket. In these cases, you will probably end up paying more miles than you did originally if you rebook.
Still, using points or miles to book flights can help you save cash on a portion of the trip.
2. Be flexible with your travel dates
In general, you’ll be able to find better deals if you don’t fly during popular times. For example, a flight from New York to Miami might cost more miles if you fly on Friday than if you fly on Thursday. Returning home on a Sunday night may cost more than on a Monday night.
Additionally, if you’re going away for any holiday, it’s usually cheaper to fly on the day of the holiday (or the evening before) rather than a few days before. For example, a nonstop one-way flight from New York to Paris during Christmas week costs $868 on Dec. 22 or $910 on Dec. 23 this year. However, those flying on Dec. 24 or Dec. 25 will have to pay only $482 or $563, respectively.
3. Use free night benefits on hotel award stays
There are also benefits to using points for hotel stays. Marriott, Hilton and IHG offer a fifth-night-free benefit when you book a consecutive four-night stay using points. This benefit doesn’t apply to cash bookings.
So if you’re planning a winter vacation, look into some properties with any of these hotel groups, then check if you have enough points to cover a four-night award stay. If you don’t, consider applying for a hotel credit card — you could earn the points you need from the welcome offer.
Booking a hotel stay on points is a great way to save money, especially on longer trips.
4. Use a credit card that provides travel insurance
Travel insurance protects you and your nonrefundable deposits from emergencies that might derail your vacation. However, these policies can cost hundreds of dollars and they’ve only gotten pricier in recent years. According to Squaremouth, a travel insurance comparison engine, trip insurance purchases through the site have increased by 300% from 2020 and 70% from 2019.
Some credit cards offer free travel insurance when you book the trip using your card. Research what travel insurance coverage is offered by your credit card. If you already get free travel insurance from your credit card, you can save a lot of money by not having to buy separate coverage.
Although your card’s coverage may not be as comprehensive as a stand-alone travel insurance policy, it may be enough. On most credit cards, medical coverage is not included in the free travel insurance policy provided. If this applies to you, consider purchasing stand-alone travel medical insurance. A medical-only policy may be cheaper than a comprehensive travel insurance plan.
5. Use a credit card that waives foreign transaction fees
If you plan on going abroad and you don’t have a credit card that waives foreign transaction fees, you may be stuck paying extra. An average foreign transaction fee of 3% of the purchase price is added each time you swipe your card. These fees can quickly add up, and frankly, you can avoid them.
There are plenty of credit cards, including no-fee cards, that waive foreign transaction fees. See if the card in your wallet already waives these fees. If it doesn’t, consider applying for a card that offers 0% foreign transaction fees.
6. Use a bank that refunds ATM fees
When you’re traveling abroad, you may find yourself in a situation where credit cards aren’t accepted so you’ll need to pay in cash. If you don’t have a bank account that reimburses ATM fees, you may be stuck paying two sets of fees: a fee charged by the ATM you’re using and a fee charged by your bank to withdraw cash at a different bank’s ATM.
These fees can fluctuate and add unnecessary extra costs to your trip. To avoid this scenario, open an account with a bank that reimburses ATM fees.
You can save money on holiday travel
If you want to save money on your holiday travels, making strategic changes to your approach can make a big difference. First, consider booking flights with miles and hotel stays with points. Doing so will not only offer extra flexibility, but it can also unlock benefits like a fifth night free when booking four award nights at a hotel.
In addition, use the perks you already have from your bank and credit card issuer to avoid paying for travel insurance, foreign transaction fees and ATM fees. These tweaks will allow you to save money on holiday travel.
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The article 6 Ways to Save Money on Holiday Travel originally appeared on NerdWallet.