Inflation has caused the cost of travel to rise, making it more difficult for retirees on a fixed income to afford their summer plans. The overall cost of travel has increased by 18% since before the pandemic, and the demand for travel is high, especially for international trips by Americans.
Retirees face a double challenge because not only does inflation reduce their purchasing power, but the stock market decline has also decreased their retirement savings. This combination can lead to financial difficulties and a need to make compromises.
To manage these challenges, retirees should factor in their retirement savings when planning vacations. It may be necessary to adjust expectations and put larger vacation dreams on hold temporarily, but retirees can also explore more affordable alternatives such as visiting nearby attractions, getting a National Parks pass, or attending local events like county fairs.
Timing can also be important. Waiting for the off-season or considering destinations with cheaper rates during the summer can help save money. Rescheduling cruises and home swaps can be cost-effective options, and taking advantage of senior discounts for accommodations, flights, and trains can further reduce expenses.
While compromises are necessary for this year, it's important to remember that they are temporary. By preserving purchasing power and making smart financial decisions during challenging times, retirees can look forward to fulfilling their travel dreams in the future.
Find a licensed financial advisor using our one-of-a-kind Find An Advisor tool.