By Anita Hamilton

Taking a summer vacation is one of life's greatest joys, but paying for it definitely isn't. If you're among the many Americans trying to keep a lid on spending over worries about the economy, it may come as a relief that travel costs are largely flat and in some cases even lower than last year. In other words, the travel industry's pain is your gain.

Money isn't the only issue, though. Recent problems at Newark airport may have you worried about a higher chance of delayed or canceled flights as well as air safety overall. But while United Airlines has scaled back flights in and out of its Newark hub, there's no indication of a nationwide air traffic meltdown.

Another twist this year is that fewer foreigners are expected to visit the U.S. over trade concerns and stepped up airport screenings. The World Travel & Tourism Council is projecting that they will spend $12 billion less on travel in the U.S. this year. But because Americans spend far more on domestic travel than foreigners, it's unlikely to affect your plans other than making tourist spots a little less crowded.

Fewer foreign travelers could also be helping to keep prices in check. Notably, domestic travel spending by Americans is expected to be flat at $1.5 trillion this year. "We expect significant softness for summer leisure travel," says Patrick Scholes, managing director of lodging and leisure equity research at Truist.

With that in mind, here's what to expect whether you are just filling up the gas tank for a weekend getaway or planning a bucket list adventure abroad.

Ready to Roll

Low gas prices are one of the biggest bright spots this summer. They're currently down about 40 cents compared with the same time last year at around $3.19 a gallon on average, according to data from AAA and GasBuddy. Combined with hotel and rental car rates that have barely budged, according to travel site Hopper, the stars just may have aligned for an affordable road trip. Summer hotel stays currently clock in at $237 a night on average, while rental cars are $47 a day.

Road trips' relative affordability could also be driving AAA's projection for a record number of them over the coming Memorial Day holiday. "Memorial Day weekend getaways don't have to be extravagant and costly," said Stacey Barber, vice president of AAA Travel. It expects more than 39 million people to hit the road over the holiday weekend, for a 3% increase over last year.

Now Boarding

If you're planning to fly within the 50 states, you may be pleasantly surprised by similarly steady prices. Round-trip flights for summer travel are currently averaging $265, which is actually 3% lower than in 2024, according to Hopper. That downward trend tracks with recent inflation data from April showing airline fares down 8% in April compared with the same time last year, on an unadjusted basis.

"Part of the reason prices are lower is because of unbundling," explains Hopper economist Hayley Berg. That means you're paying the same amount for less, typically in the form of a skimpier cabin class with no reserved seats, no free checked bag, or no refunds after the standard 24-hour grace period after booking. Another factor is increased competition among carriers offering such bare-bones service.

Big cities like New York, Las Vegas, Chicago, and Miami lead in terms of overall popularity of travel destinations, based on hotel reservations. But you could get better deals if you look elsewhere. Among Hopper's trending destinations, Manchester, N.H., Wilmington, N.C., and Vail, Colo., are seeing the biggest price drops compared with last year, ranging from 25% to 37% less than last year.

Passport Required

If you're looking to travel abroad, you'll get the most affordable airfares on trips to Canada, which are averaging $305 round trip, for a 25% dip from last year, according to Hopper. A chilly relationship with our Northern neighbor amid trade tensions and President Donald Trump repeatedly saying he'd like to make Canada the 51st state is likely impacting both demand and prices.

Mexico and Central America are the next cheapest destinations at $421, for a 10% drop from 2024. You can also get flights for the same price to the Antilles -- comprised of Cuba, Jamaica, Puerto Rico, the Dominican Republic, Haiti, and the Cayman Islands -- for the same average price. That is actually 1% more than last year, but still a good deal.

With a bigger budget, you could snag deep discounts on longer-haul flights to places like Sydney, Australia, and Stockholm, Sweden. Round-trip flight prices are down 23% and 17% to $1,005 and $935, respectively, compared with last year, according to travel site Kayak.

Another way to save on international flights is by finding a similar, but less expensive destination, also known as a dupe or swap. For example, instead of Santorini, Greece, which will set you back $1,194 on airfare, consider Mallorca, Spain, for $889 round trip. Portugal can be a budget-friendly alternative to the Canary Islands, saving you more than $300 round trip, for a total of $837.

Cruise Control

Don't sleep on promotions and deals for cruises, which are on the rise as demand softens. "While overall headline ticket pricing growth on new bookings remains strong/consistent," Truist analysts noted in a recent research report, "we have begun to see significant promotion/value-add activity to entice bookings."

You could snag anything from a free upgrade to a suite for the price of a single balcony room to a $200 on-ship credit if you book at least 90 days advance. The latter deal dovetails nicely with lower flight prices that typically arrive at the end of August.

If you're on the fence about taking a cruise, it might help to know that they tend to be 10% to 20% less expensive than land-based trips. They're an especially good deal compared with Disney and Caribbean resorts, the Truist team notes.

Trip Timing

It pays to be choosy about when you travel. After Memorial Day, domestic flights in late June, for example, have the highest average price of any summer weekend at $281. The cheapest travel weeks start Monday, July 21, and Monday, Aug. 18, with flights averaging $256 and $260, respectively.

Likewise, consider which nights you're staying in a hotel. Sundays and Mondays are cheapest at $211 and $221 on average, respectively -- about $40 to $50 less per night than on Fridays and Saturdays. If you're visiting multiple cities on your trip, consider staying in the less expensive one on the priciest nights and the most popular one on cheaper days to avoid paying top dollar overall.

After all, the less you spend on flights and hotels, the more you'll have left to enjoy your destination.

Write to Anita Hamilton at anita.hamilton@barrons.com

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

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May 21, 2025 02:00 ET (06:00 GMT)

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