My observations and recent studies show that travel is a way of life for Millennials and Gen-Zs. Failing to recognize this and properly budget for travel can lead you into financial difficulty.
Back When I Was Young, Travel Was A “Want”.
Time for a dad’s story. Back when I was a twenty-something, like most people at the time, I received 2 weeks of vacation a year. Vacations were something we squeezed into 6 or 7 days! One week was a trip to the New Jersey shore and another week was a trip to the Carribean. To get to the island in those days I purchased a packaged trip from Apple Vacations. Any weekend trips involved road trips by car to visit friends along the East Coast.
Fly Eagle Fans Fly
My wife and I went to visit my daughter in DC for Columbus Day weekend. On Sunday, I went to District Anchor to catch the Eagles game with other Eagles fans. I managed to grab a table with a couple of empty chairs right in front of the TV. A nice young couple showed up and asked if they could join me. She moved to DC from the Philly area and her boyfriend was visiting her for the weekend. The boyfriend shared with me his pictures of his trip to London the year before to see the Eagles play. They also told me about their upcoming trip to Dallas to see the Eagles play the Cowboys. Not only do the Eagles fly, but their fans do too!.
Sami’s Big Adventure
While an undergrad, my daughter participated in the Junior Year in Munich Program (JYM). Through JYM she spent her entire junior year of college living in Munich, Germany. Recently, a JYM alumni magazine arrived at our house and I was flipping through it. I came across a write-up on how one of her JYM friends, Sami, had reconnected with other JYM alumni. The article mentioned how Sami had gone to Scotland to attend the wedding of a couple she had met through JYM. After the wedding, she then traveled to Paris and then to Munich. From there she met up with another JYM alum for a quick trip to Italy. The article goes on to say that a few months later they met up again for a trip to Ukraine together. Sami visited more countries in one year than many see in a lifetime.
My Kids Are No Different Than Their Peers
In 2019, my son traveled to New Orleans for Mardi Gras and in the fall went to Hawaii for a week. My daughter traveled to Boston for several weekends and took a trip to LA in the fall to a music festival. Note: The Bank of Financial Dadvisor provided zero funding for these trips!
Surveys Show Travel Is A Priority For Millennials and Gen-Zs
The ambition of Millennials and Gen-Zs is misunderstood. Millennials and Gen-Z goals don’t align with their parents’ goals at the same age. Per the chart below, Millennials and Gen-Zs’ top priority is traveling and seeing the world. Also, according to the same study, women (62%) are more interested than men (51%) at seeing the world.
Dave Ramsey Doesn’t Get It!
Budgeting systems such as Dave Ramsey’s and Nerd Wallet’s still list travel as a “Want”, something optional in your budget, such as gym memberships, lattes, or designer clothing. But, for many individuals, travel is a “Need”, right up there with housing, food, and utilities.
If you plan to take a trip this year, then make sure you budget for it as a “Need”. Estimate your total expected travel cost for the year and divide it by the number of paydays for the year. If you plan to spend $4,800 on travel this year and are paid twice a month, then you need to set aside $200 ($4,800/24) per pay period.
Is Travel A “Need” In Your Budget?
What are your travel plans for this year? Are you part of the 57% that want to see the world? How do you budget for travel?
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