In this photo illustration, Visa, Mastercard and American Express logos are seen on credit and debit cards on November 5, 2023 in Bath, England. Visa and charities have warned that the UK is entering a dangerous new phase of the cost of living crisis, with millions of British households taking on debt to cover basic bills and expenses. (Matt Cardy/Getty Images)
Nearly half of Americans plan to travel this summer, which could increase their credit card debt, according to a March survey from Nerd Wallet.
Approximately 45% of Americans plan to travel to destinations that require a flight or hotel stay during the summer. Researchers have found that on average an American spends $3,594 to cover travel expenses.
The survey also found that while the majority of summer travelers, approximately 84%, will use credit cards to pay for their trips, not everyone plans to pay right away. I did.
“Surveys show that 20% of summer travelers plan to use credit cards for these expenses, but do not intend to pay the full cost within the first bill,” the study states.
“According to the most recent data from the St. Louis Fed, the average credit card interest rate for interest-rated accounts is 22.75%. To put this in perspective, for every $1,000 you own on a credit card per year, you pay approximately $228 in interest. It will happen.”
To avoid paying additional interest, experts advise consumers to cut back on some spending and use the money to pay down credit card debt or pay off bills early.
“To pay off your debt faster and minimize interest charges, create a plan that you can stick to,” Sally French, travel expert and spokesperson for NerdWallet, said in a statement.
“If you can, increase your monthly payments. Even small increases can make a difference, such as rounding your payments to the nearest hundred dollars or using money you receive as a gift or a side job to pay off your debt.”
However, not everyone plans on taking on additional credit card debt during the summer travel season.
Other Americans planning trips are choosing more affordable travel and lodging options. About 42% of travelers travel to their destination by car rather than by plane, while 39% of other travelers stay at a hotel, motel, or resort based on price rather than the amenities offered. intend to do something.
The full study can be viewed here.
