SUMMER VACATIONS: FUN IN THE SUN OR FAMILY BUDGET BUSTER? Garden State Consumer Credit Counseling Offers Advice for Consumers Facing a Big Tax Bill ________________________________________________________________ June 6, 2003: Summer is here again. Time for picnics, barbeques, lazy days and family vacations. But along with the heat, your family’s expenses can soar when it comes to planning a summer getaway. Avoid breaking the bank by considering some basic saving tips that can help your vacation memories last forever, but not your credit card bills. “Oftentimes, families don’t realize that even a weekend trip can be surprisingly expensive,” says Joel Greenberg, president of Garden State Consumer Credit Counseling (GSCCC), a national 501(c)(3) nonprofit credit counseling and debt management agency. GSCCC counselors routinely work with families in San Diego County and around the nation to effectively manage their debt and credit concerns, and offer counseling about money management and the wise use of credit. “Adults and kids alike look forward to a summer trip all year long, but a few days of fun can be one of the biggest drains on the family’s annual budget. By using some creative saving and spending strategies, consumers can still have a great time while leaving their financial health intact.” Vacations mean big bucks. The Travel Industry Association of America estimates that Americans will spend $2,000 on a summer vacation this year and 43 percent of adults ages 18 to 34 say they will spend more money on summer vacations this year than last. Unfortunately, many will put nearly half or all of these expenses on their credit cards and will not be able to pay off the balance right away. Consider this scenario: If an average family of four spends approximately $4,400 on vacation, put all vacation expenses on a credit card with a 17 percent APR and made just the minimum payments each month (approximately two percent), it would take 38 years to pay off. In the meantime, they would accrue over $9,847.38 in interest charges, more than doubling their original expenditures. Think of it as an extra vacation they missed out on. To avoid these summer budget busters, GSCCC offers the following vacation savings tips: Save, save, save. Open a special savings bank account that is specifically for family vacations, and put money into it each time you get paid. At home, start a “vacation fund” for the whole family by collecting everyone’s loose change at the end of the day and putting it into a sealed jar. Clean out your garage and closets and make some extra money by holding a garage sale. Skip on buying the daily specialty coffee and bagel each morning, and put the extra three or four dollars in a drawer at your office desk. Saving money up front will help you avoid putting vacation purchases on a credit card. Realize that ever dollar counts. If taking a big summer trip is a priority for your family, determine early on where compromises can be made in other areas of your family’s monthly budget. Look for things that can be eliminated or reduced. Pack a lunch instead of eating out. Carpool with a friend or ride your bike to work. Cancel your gym membership and work out outdoors. Avoid spending on credit except for true emergencies. Being conscious of where you are spending your money allows the savings to really add up quickly. Do your homework. Take advantage of the Internet to find information about discounts on hotels, airfare, tours and other entertainment. If you research all the different possibilities ahead of time, you will be amazed at the discounts that are out there. Some popular travel guides will help you compile an itinerary and make sure you get the most for your vacation dollar. Also, be sure to ask about possible discount for students, seniors or auto club members. It never hurts to ask. Plan ahead. Make sure you make your travel arrangements early. Airline tickets are much cheaper when booked several months in advance as compared to last minute. If you pay for airfare and lodging ahead of time, you will be able to spread out your major expenses and budget more accurately for incidentals such as taxi fares, toll bridges and subway trips. Entertainment does not have to be expensive. Those helicopter rides, bus tours and shows can put you several hundred dollars in the hole, so why not be creative when it comes to activities away from home? Take long walks on the beach or hike a mountain trail. (Kids love these thrifty adventures!) Box up your lunch and take it with you while you’re sightseeing to avoid overpriced tourist traps. Look for coupons or special promotions for discounted prices on otherwise expensive activities. There are several ways to save a buck if you take some extra time and get creative. Think out of the box. Instead of a lengthy – and expensive – vacation, take a quick weekend trip to a closer destination. Instead of buying expensive airline tickets, hop in your car and go to a nearby beach, mountains or desert. Explore nature and go camping instead of paying for a hotel. Check out local state parks rather than expensive theme parks. You don’t need to travel far from home to “get away from it all.” Some attractions also have special deals for local residents, so be sure to check these out. Learn to be flexible. To achieve a dream vacation on a limited budget, try traveling in the off-season, when you may be able to save up to 50 percent on airfare and hotel accommodations. Also, be more flexible with your travel schedule. The days of the week on which you travel can make a big difference in rates for everything from rental cars to hotel rooms, so be sure to ask about special weekend and weekday rates when booking reservations. Consider inviting another couple or family to join you so you can split expenses like gas and lodging. See the potential elsewhere. If you are planning a trip abroad and are open to “roughing it” a little, backpacking, walking and bicycling can be a great way to tour the country. Hostels are popular with young adults and are considerably less expensive than hotels. Even if you are interested in more traditional lodging, paying for a motel (rather than a fancy, big-name hotel) will save you cash, especially if you’re planning on being out sightseeing (away from your room) for the majority of your days. Some countries have government-run accommodations that are also well priced. For more information on services offered by Garden State Consumer Credit Counseling, including free budget consultation and credit analysis, call 800-99-BILLS (24 hours a day, seven days a week) or visit www.gardenstateccc.org.