Some MarketWatch readers say they spend about $10,000 a year on travel. We asked financial advisers what the right amount is.
It’s the time of year when a sort of postsummer spending hangover kicks in. I look at just how much money I’ve sunk into weekend getaways and patio drinks and think: “Who did that? It couldn’t have been me.”
But, as is the case with every hangover, it is me who made those decisions that now seem so ill-advised.
That’s why I could totally relate to the most recent letter writer to my advice column, Dollar Signs, who expressed frustration at how to balance his and his partner’s desire to travel with making responsible saving and investing decisions.
“If we go too long without an excursion, we get cranky. Home life gets more difficult. Work performance suffers,” he wrote to me. “We want to make sure we experience a good chunk of what the world has to offer in our short time on this planet, but we don’t want to fall way behind on our financial goals because of it. Is that even possible, or are we living in fantasyland?”
Who hasn’t gotten restless, bought the plane ticket, booked the Airbnb
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and then be puzzled that they don’t have more in savings?
Answering this letter writer’s question got me thinking: How much do people actually budget for vacations? That’s why I decided to ask you, the MarketWatch readers, in recent Instagram and Twitter posts: How much do you think is appropriate to spend on travel?
Almost one-fifth of the 47 Instagram respondents said $10,000, and about 50% of the 2,832 Twitter respondents said above $5,000.
This is far above what the average American says they allocate to trips. A Deloitte survey from April found that Americans planned to spend $4,606 on travel this year. And even though Americans’ sense of financial well-being had declined, more people intended to take vacations this summer than last year: 53% versus 48%, Deloitte found.
This disparity made me wonder if there is a formula for how much you should spend on travel each year and it turns out there is
