Should You Book Holiday Travel Now While Prices Are Still Low?

by Jeremy

Though you may have skipped spring break this year or canceled your family summer vacation, holiday travel might still be on the table. On the one hand, the coronavirus is nowhere near eradicated, so it’s hard to know whether it will be safe to travel by winter. But with ticket prices so low ― at least for now ― it can be tempting to get in while the getting’s good.

According to travel booking app Hopper, domestic flight prices around Christmastime have dropped 25% compared with 2019, reaching a new low of $275 round trip, on average. As for Thanksgiving, travelers can expect to spend 30% less on domestic flights than in 2019, with a new average low of $216 round trip.

Of course, things could change as we get closer to the holiday season, and prices might go back up. Here’s what you should keep in mind when planning to travel for the holidays.

Research the best cancellation policies

Airlines and hotels are understandably struggling right now. To encourage bookings, many have lowered not only their prices but also relaxed their cancellation policies.

American Airlines, for example, now allows customers who book tickets for travel through Sept. 30 for flights occurring before Dec. 31 to cancel or change their itinerary for no fee. Hyatt is allowing all reservations made for travel until July 31, 2021, to be changed or canceled up to 24 hours before check-in without a fee.

However, just because you might be allowed to cancel doesn’t mean you’ll have cashback in your hand right away. “Be aware that while most airlines have generous cancellation policies at the moment, if you’re the one to pull the plug on the trip, you’ll likely receive a voucher for future travel rather than your actual money back,” said Ted Rossman, industry analyst for CreditCards.com. It’s only when the airline cancels the flight or makes a substantial schedule change that you’re entitled to actual money back.

That means you won’t lose any money, but your funds could be tied up for a while if you do decide to cancel. “If you’re OK with a future voucher, then, by all means, book now,” Rossman said.

Another option is to look into a “cancel for any reason” travel insurance policy, though keep in mind there are a couple of catches. Rossman warned this type of insurance costs more than a standard travel insurance policy, and it doesn’t reimburse all of your expenses ― more like 50% to 75%. Generally, this type of travel insurance is better suited for major international trips, not short domestic ones.

Finally, Rossman said it’s a good idea to book travel with a credit card. “Credit cards have more generous dispute resolution policies than debit cards,” he noted. Plus, as long as you avoid racking up interest by paying your balance in full each month, credit card rewards can be valuable and help offset the cost of the trip.

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