NerdWallet’s 2021 Holiday Travel Report

Holiday travel is on the rise again, but some people are on the fence or are outright avoiding travel this season.
Erin El Issa
By Erin El Issa 
Updated
Edited by Meghan Coyle

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The COVID-19 pandemic changed just about everything last year, and many Americans (26%) opted out of traveling for the holidays because of it. This year, more than 2 in 5 Americans (43%) plan to spend money on flights or hotel stays during the holiday season, spending $1,814, on average. That’s close to 110 million travelers spending nearly $200 billion on holiday travel expenses, according to recent NerdWallet analysis.

A new NerdWallet survey of more than 2,000 U.S. adults — 780 of whom plan to spend money on flights/hotel stays for the 2021 holidays — conducted online by The Harris Poll asked Americans about their travel plans this holiday season. We also asked travelers how they’re saving money on holiday travel, whether or not they’re charging travel expenses to a credit card, and how COVID-19 is impacting their planned trips.

Key findings

  • Close to 3 in 10 Americans who say they didn’t travel during the 2020 holiday season (29%) plan to spend money on flights/hotel stays during the 2021 holiday season, according to the survey.

  • The survey shows that of Americans who plan to put 2021 holiday travel expenses on a credit card, the average they plan to charge is $1,471. That’s more than $116 billion in total credit card spending on holiday travel this year.

  • The survey found that about 9 in 10 holiday travelers (89%) — defined as those who plan to spend money on flights/hotel stays for the holidays this year — are taking action to save money on holiday-related travel expenses.

  • Around a quarter of holiday travelers (24%) say they’re using a different means of transportation to travel for the holidays than they normally would because of COVID-19, according to the survey.

  • More than three-quarters of Americans who are unsure if they will be spending money on flights/hotels this holiday season (77%) say their reasons are COVID-related, the survey shows. The same goes for more than half of Americans who don’t plan to spend on flights/hotels for the holidays this year (57%).

“COVID ruined so many holidays and special events. Americans are ready for a holiday season that feels like it used to, and for many, that means traveling to visit family and friends,” says Sara Rathner, travel expert at NerdWallet. “The urge to spare no expense is strong, but set a budget and try to stick to it. You can have a special holiday without spending the new year paying the price for it.”

Holiday travel ramping back up after 2020

The COVID-19 pandemic has been disruptive to many Americans’ travel plans. More than a quarter of Americans (26%) say they intended to travel during the 2020 holiday season, but didn’t because of the pandemic, according to the survey. Some of those who opted out of travel last holiday season are heading out this year.

Close to 3 in 10 Americans who didn’t travel during the 2020 holiday season (29%) say they plan to spend money on flights and hotels during the 2021 holiday season. Throughout this report, we’ll refer to those who plan to spend money on flights and hotels this holiday season as “holiday travelers.”

Most holiday travelers using credit cards

More than 7 in 10 holiday travelers (71%) say they’ll put at least some of their travel-related expenses on a credit card, charging $1,471 on average. That’s close to 80 million Americans spending a combined $116 billion on credit cards for holiday flights and hotel/motel stays.

Unless you’re experiencing a true emergency, we recommend avoiding credit card debt if possible.
Sara Rathner, NerdWallet Travel Expert

Putting travel charges on a credit card isn’t synonymous with going into debt for holiday travel. More than 1 in 5 holiday travelers planning to put expenses on a credit card (21%) say they’ll pay off the balance with the first statement. That means they won’t owe any interest and can just reap the benefits of potential credit card rewards and purchase protection.

However, some travelers plan to carry balances, at least for a little while.

Holiday travelers charging these expenses to a credit card think it will take them, on average, 2.8 months to pay these balances off. This would cost these holiday travelers $40 in interest each, or a total of close to $3.2 billion, according to NerdWallet analysis.

“Unless you’re experiencing a true emergency, we recommend avoiding credit card debt if possible. It adds onto the cost of everything and can quickly spiral out of control,” Rathner says. “It can be easy to justify an extra $40 for the holidays, but what if your car breaks down in January and you take on more debt before you pay off those holiday bills? When you don’t have credit card debt, you’re in a better position to deal with unexpected costs.”

Holiday travelers taking steps to save

The majority of Americans who travel for the holidays (70%) save for these trips in advance, but maybe not far enough in advance. More than 1 in 5 (22%) save for five weeks or less, and on average, those who travel for the holidays save for just 9.4 weeks before travel. Assuming they spend the reported average of $1,814 on holiday travel, they would need to save close to $200 a week — on top of what they might be saving for other holiday costs.

That said, most holiday travelers (89%) are taking action to save money on their travel-related expenses. The top money-saving methods? More than a third of holiday travelers (37%) say they’ll choose a flight based on price instead of convenience, and 33% say they’ll choose a hotel/motel based on price instead of amenities.

COVID-19 impacts travel for another holiday season

Despite the fact that more Americans are traveling for the holidays this year — 43% plan to spend money on flights or hotel stays for the holidays, compared to 19% who did so in 2020 —  the COVID-19 pandemic persists, and so does its impact on travel. Roughly a quarter of holiday travelers (24%) say they’re using a different means of transportation than they normally would because of COVID-19, and 22% say the same thing about the type of lodging they’re opting for this year.

Some opt not to travel, or aren’t sure about travel, due to COVID-19

Some Americans (38%) aren’t heading out for the holidays this year, and many of them cite COVID-19 as a reason. Of those who don’t plan to spend money on flights/hotels during the 2021 holiday travel season, 57% say it’s at least partly related to COVID-19, with concern about variants being the top COVID-related reason (34%) for not traveling.

Others (19%) have yet to decide if they’re going to spend money on flights/hotels this holiday season. Of those unsure about holiday travel, more than three-quarters (77%) say their reasons are related to COVID-19, with the top COVID-related reason being concern about variants (52%).

“Whether or not you feel comfortable traveling this year can depend on your family’s situation, as well as the situations of the people you’d usually visit. There are still many reasons to stay close to home in your bubble,” Rathner says. “If you haven’t had those tough conversations about whether or not travel is possible for you right now, it’s time. Health and safety come first.”

Tips for travelers this holiday season

Save for travel in advance. Ideally, you should put money aside year-round for intermittent, but expected, expenses like car registration and holiday travel costs. But saving as far in advance as possible is the next best thing. With gifts, travel, decor and more, the holidays are an expensive time of year for many, and saving early can help you avoid high-interest debt.

Pay off any accrued credit card debt quickly. Sometimes debt happens, and if you rack up a balance this holiday season, make a plan to pay it down sooner rather than later. Interest charges on a credit card may seem immaterial when you’re only carrying a balance for a few months, but credit card debt carries a high average interest rate and it’s easy to let it linger while making minimum payments. Work to eliminate the debt so you aren’t carrying 2021 spending too far into 2022.

Keep holiday travel plans flexible. The pandemic has highlighted the importance of keeping travel plans flexible, which is especially important as we deal with new COVID-19 variants and changing travel restrictions. If you’re booking a flight for holiday travel, check out airline cancellation and change policies. It’s also a good idea to look into travel insurance, but make sure you know what a policy covers before purchasing it.

“Sadly, we’re still having to make many of the same difficult decisions about holiday travel as we had to make in 2020,” Rathner says. “If you want this year’s celebrations to make up for last year’s holiday-by-video-call, just be mindful of your spending. Taking care of yourself this year means following COVID precautions, but it also means protecting your finances, too.”

Methodology

This survey was conducted online within the United States by The Harris Poll on behalf of NerdWallet from Sept. 13-15, 2021, among 2,026 U.S. adults ages 18 and older, among whom 780 plan to spend money on flights/hotel stays during the 2021 holiday season. This online survey is not based on a probability sample and therefore no estimate of theoretical sampling error can be calculated. For complete survey methodology, including weighting variables and subgroup sample sizes, please contact Lauren Nash at [email protected].

The 2021 holiday season is defined as Nov. 18, 2021, to Jan. 5, 2022, for the purposes of this study.

We used U.S. Census population estimates and survey responses to calculate the total number of Americans who plan to spend money on flights/hotels this holiday season, as well as the total travel expenses and the total travel expenses charged to credit cards.

We used the most recent average annual percentage rate data from the Federal Reserve of St. Louis (17.13% as of August 2021) to calculate credit card interest.


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