Consumer spending on holidays skyrocketed in January, as people booked holidays, flights and cruises for the year ahead, new data revealed.
While non-essential spending dropped between December and January, consumers spent 43 per cent more last month as pent-up demand was unleashed, according to Nationwide Building Society.
People desperate to get away took full advantage of new travel freedoms in January as spending on holidays jumped up by 379 per cent.
Specifically, airline travel rose 408 per cent, while money spent on cruises rose by 899 per cent.
Mark Nalder, Nationwide’s head of payments, said: “People spent more at the start of this year, with consumer spending in January up 18 per cent compared with the same period last year, despite the current rising cost of living.
“This is likely to be driven by the 34 per cent year-on-year increase in the number of transactions made by consumers and is perhaps reflective of a country that, despite the Plan B restrictions, is more open for business than it was 12 months ago, when the country was plunged into national lockdown.
“Spending on holidays, airline travel and cruises played a big role in that, as consumers start 2022 in a positive frame of mind about the outlook for Covid-19 and about their travel plans for the coming year.”
As confidence in holidays soars once again, i breaks down how you can save on flights, hotels and leisure costs.
How can you save money on flights?
When it comes to destinations, it appears travellers want to go further afield in 2022 with Dubai, New York, Australia, Amsterdam and Japan the top locations, according to money saving app Chip.
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However, Helen Forward, money expert at Chip, warned travellers still need to be mindful of other countries’ Covid and insurance rules, which could change at a moment’s notice.
She said: “Because there is still a fair amount of uncertainty and no way of knowing what the situation will look like come spring and summer, try to get flexible bookings.
“Additionally, paying by credit or at least debit card can give you additional protection.”
Ms Forward added that it’s always good practice to get your travel budget sorted in advance.
“My main tip for saving money would be to shop around. For flight bookings, use websites such as SkyScanner and Momondo to find the best fares and flight times.
“Shop around for your accommodation and check the prices with different booking platforms as they can vary quite a bit.”
How can you save money on hotels?
When looking for the best hotel deal, booking last minute may be beneficial, according to hotel.com.
Emma Tagg, head of brand communications at Hotels.com, said waiting to get a good deal, rather than booking in advance, is a great way to cut costs.
She said: “While booking last minute may seem risky, it can actually be a good way to score some killer deals.
“Gone are the days when you needed to book your hotel stay months in advance.
“In fact, booking right at the last minute can save you lots of money if you can keep your nerve and are not travelling somewhere that is likely to be unusually busy.”
While app-only deals can be found with hotels.com and other travel apps, it is also worth signing up for emails, following travel companies on social media and checking out discount code websites.
If you’re a recurring customer with a particular hotel chain, it’s worth signing up for its loyalty programmes too.
Ms Tagg said: “It really does pay to be loyal. Sign up for loyalty programmes to enjoy access to the best rates, discount coupons, free nights and VIP services, and extras.”
She also urged shoppers not to go for the first room on offer, with corner rooms usually providing the best option for those willing to seek them out.
“Due to the structural layout of a building, these rooms generally have the most square footage and windows, while also offering the lowest noise level.
“It will feel like you have a nicer room, without actually paying for one.”
How can you budget your spending money?
The average holiday cost, according to Atom bank, is £1,567 which means consumers would only need to save £5 a day to book a trip in under a year.
However, Clare Framrose, head of savings at Atom bank, warned a common mistake people make is not accounting for enough spending money, as opposed to affording the holiday itself.
She said: “It’s useful to plan ahead – research which excursions you might want to take and how much on average they cost, factor in transport costs for the whole trip and consider what you’re likely to spend on food and drink.
“If you know you’re likely to want to splurge, budget accordingly.
“Setting a daily spending allowance can help to ensure you don’t end up overspending at the start of your trip.”
It’s also worth having contingency funds for unexpected expenses, particularly due to the ever-changing nature of the travel industry at the moment.
She added: “Should travel rules change whilst you’re away, it’s sensible to be prepared for any additional tests or unanticipated quarantine.”