Interest rate rises don’t stop Aussies holidaying

AAP says that most Australians would put off buying a home before cancelling holiday plans, a new survey has revealed.

An online poll by travel service lastminute.com.au found that every one of the 1013 respondents felt they would need to make some changes to their personal budget as interest rates keep rising.

Almost 30 percent of those polled said that buying a home would be the first priority scrapped from the to-do list and a further 20 percent would delay buying a car.

However, less than one tenth of respondents would have cancelled Easter holiday plans and even less (4.5 percent) would sacrifice taking holidays in general.

The CEO of lastminute.com.au, Chris Meehan, says it’s interesting material possessions are the first thing to be sacrificed.

He says people are recognising the importance of preserving parts of their life that will keep them happy like holidays.

But if you’re conscious of your pennies then it may be possible to have the best of both worlds.

“A rule of thumb for the cost-conscious traveller is to stay flexible with destinations and travel times,” he says.

“If Bali is on your wish list but there’s a bargain offer to Thailand, consider switching.”

Justin Montgomery, managing director of Creative Holidays, agrees, saying recent interest rate increases and historic trends have shown that the impact of the increased cost of living due to rate increases has a short term effect on consumer holiday spending.

“With a number of rate rises last year we saw the market slow, but only for a few weeks before experiencing an unprecedented boom in enquiry levels in the first two months of this year,” he says.

“I predict the same thing will happen this time.”  “Straight after the Reserve Bank announces the rise consumer spending slows, but traditionally when it comes to holidays this decline is only temporary.”  “Once people have settled after the change, that dream holiday or break is back on the radar.”

“That could be because Australians love holidaying.”

“It is a lifestyle choice that ranks highly on the priority list and while interest rate rises impact on holiday plans in the short term, they certainly don’t tend to impact in the long term,” Montgomery says.

Avid traveller, Lydia, 22, is keen to spread her wings, but is mindful of her future.  She says that her priority at the moment is “to go travelling and just enjoy myself”.

But, she adds: “Having said that it’s also a priority for me to come back from that still having a bit of savings to do the other things that I want to do and live comfortably.”

She admits that she has always been a good saver, but doesn’t bath in her gold coins, a la Scrooge McDuck.

“I think that it (money) gives you more choice and makes it easier to do the things that make you happy.”

“In terms of money and the future I do strongly think that it’s important to get ahead and set yourself up fairly young to get what you want to achieve further down the track,” she says.

This is lastminute.com.au’s list of pointers for travelling on a shoestring:

1. Timing is of the essence: One of the best times to purchase flights is right now. March 31 marks the end of fare season which means all the current year’s fares are about to expire and they’re available at cheaper prices.

2. Think cheap: When it comes to airlines, Malaysian Airlines is typically renowned for its great value airfares, while destinations like Vietnam, Cambodia and Laos are heaven for the thrifty traveller.

3. Leave right on the money: Airlines that leave less frequently from Australia generally have cheaper fares so before you book check the schedule of your chosen airline.

4. Stop right now: Consider a stop-over at destinations such as Singapore, Hong Kong or Dubai where some airlines offer free accommodation, meals and transfers at the stopover point.

5. Don’t always fly to the obvious airports: Do your homework and be creative when booking your flights and planning your itinerary.

6. Check the fine print: Some travel agents don’t include taxes and fuel surcharges in their quoted prices so make sure you check the fine print, otherwise you may cop a few extra hundred dollars on your holiday bill.

7. Keep an eye out for family concessions: Taking the whole family away can be expensive, so some airlines offer both child fares and companion fares. In fact, some airlines offer child fares free up to the age of 17 years, and companion fares can save you up to 15 percent.

8. Keep an open mind: To increase you chances of finding bargain accommodation or airfares, stay flexible with travel times and be ready to pounce on a deal as soon as you see it.

A Report by The Mole from AAP