CNN
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“I think of holiday money as Monopoly money,” says Lisa Fraser.
The 30-year-old, who is currently unemployed, travelled to Taipei, Budapest and New York last year, with no intention of giving up her holidays while she looks for a job.
“I don’t have a budget. I have a rough idea, but if I go over it, I go over it. I will never stop myself from having what I want on vacation.”
According to a 2023 study by financial site WalletHub, 25% of Americans say it's worth getting into debt to have a good vacation. The majority of people who get into debt do so by paying for their travel expenses with a credit card. 20% of respondents say they would prefer to avoid paying by credit card and spend the money on a vacation.
Elizabeth Currid-Halkett is the author of The Sum of Small Things: A Theory of the Aspirational Class and professor of public policy at the University of Southern California. She believes that the current trend of travel moving from “optional” to “priority” began during the financial crisis of the 2000s and peaked after the pandemic.
“We couldn’t have predicted it, given how the pandemic has affected different generations in different ways, but the idea that our friends matter, that living your life matters, how important it is to live a good life – it’s led to a change in how people spend their money.
“When you're young, you don't have the money to change careers, but you can say to yourself, 'I'll think about it later and live my best life now.'”
Currid-Halkett talks about what she calls “the avocado toast thing.”
She refers to a 2017 Interview with Australian real estate mogul Tim Gurnerin which he seemed to imply that millennials couldn't afford big purchases like down payments on homes because they were spending all their disposable income on avocado toast.
Gurner's comments went viral and were turned into numerous memes, many of which argued that house prices had risen so much while wages remained stagnant, which was the real reason young people couldn't afford to buy houses – not their brunch orders.
“Social mobility is so out of reach that you have to make concessions,” says Currid-Halkett. The mindset is: “I can’t buy a house, I’m not sure I can afford to go to college or university, so I might as well go to Spain and backpack. It barely reduces the debt I’m going to have to go into for other things.”
Alex King, founder of a personal finance website Silver Generationuses another word for this phenomenon: “reckless spending.”
“They feel like they’re owed something and that their generation has been treated unfairly,” he says. “They think credit card debt isn’t as risky as it is. They don’t really care about not getting into debt.”
King adds that social media has changed the way many people think about travel. Digital nomads, influencers and content creators make it seem like full-time travel is accessible to everyone.
Fraser admits that fear of missing out plays a big role in her decision-making, as she hates feeling left out when her friends go on holiday without her. She also makes the effort to visit shops, cafes and other places she's seen online.
While some people can simply pay for an expensive flight with a credit card and pay it off later, others can sign up for payment programs through third-party programs like Klarna, Uplift, and Affirm.
These “buy now, pay later” services are accepted by many airlines, including United, American and Delta, but King believes they can be predatory.
“Some people get into debt recklessly, but they start to manage their debt over time and their income starts to increase. If they are a little stricter about how they manage it, they can get out of it. But there is a group of people who get into debt habitually. When it hits them, they start thinking about buying a house. It’s not just your income that matters, it’s your debt.”
Fraser’s financial experiences include a range of spending habits. In one instance, she moved out of a flat and let the landlord keep her deposit instead of paying the next month’s rent so she could have money in her pocket for a trip with friends. She also received money from her parents and paid for purchases with a credit card in Hong Kong, which she stopped paying when she returned to the UK.
As for her long-term plans, she is still unsure of what will happen, although her goal is to return to Hong Kong, where she lived before being laid off from her job as an English teacher last year.
“If I have to buy a house, I'll buy it. I'll make it work. I don't want to talk about fate or anything like that, but if I have to buy a house, I know I'll have one, so I don't worry about it.”
