Millennial Money: Young adults traveling on fiscal thin ice

Prices for travel remain stubbornly high. The cost of airfare in February was 27% higher than the same month a year earlier, according to U.S. Bureau of Labor Statistics data . And rental car prices — having shot up during the pandemic — remain high today, as they’re 37% pricier in February than they were in the same month in 2019.

Yet costlier travel is not deterring younger Americans who are eager to hit the road (and the skies) this year. A whopping 87% of 18-to-29-year-olds and 90% of 30-to-44-year-olds intend to travel this summer, according to a March survey by The Vacationer. If the economy is slowing, younger travelers aren’t heeding the memo.

“When I meet with folks, they’re not budgeting,” says Dylan Snowden, a financial coach . “Most will just think about hotels and flight, but not the fact that they need to feed themselves three times a day.”

Ignoring the broader economic trends (like the rising cost of eating out) could mean stormy financial waters ahead for these vacationers. On top of inflation, savings are down, debt is up and the economy could be headed for a recession. Add the potential for student loan payments restarting this year, and a dire picture begins to emerge for those under 40.