Readers Share Their Trip-Financing Strategies

The question was this: How much of your income is reasonable to spend on leisure travel?

Charles Jones’ solution is 7%. Jones, who lives in Calabasas, went to Europe with his wife early this year, a trip that has become a winter tradition. They used one of the largest European tour operators, New York-based Trafalgar Tours USA, and Jones calculates that they spent 7% of their annual household income on the trip.

Bonnie Abaunza’s answer is 4%, with a footnote. Abaunza, a single mother who lives in Los Angeles, recently left the film production business to work for Amnesty International. She didn’t take a vacation last year (that’s the footnote), but in 1999 she and her daughter went to Australia for two weeks, paying as they went to avoid credit card debt.

The answer from Carol Collins of Sherman Oaks, a CPA who tracks her finances on a computer program and isn’t afraid to use it, is 3.5% of household income in 1998, when family members spent 11 days in Hawaii; and 4.1% in 1999, when they also spent 11 days in Hawaii. In 2000, when she, her husband and their 4-year-old stayed with family on a trip to New England, the number was a more modest 2.2%.

Jones, Abaunza and Collins were among those who revealed their financial strategies after I posed the vacation question in a recent column. Since then I’ve been collecting e-mails and letters, making phone calls, querying colleagues and cross-questioning hostel receptionists. Well, one hostel receptionist.

The goal was partly to see how differently people approach vacation spending and also to see how they time their spending--as they go, after gradually tucking away savings, or after the fact, paying interest charges on a credit card or loan.

Of course, all sorts of variables are built into these numbers. For instance, if you’ve already paid off your house, you’ll probably feel comfortable spending more on travel than would somebody with a hefty mortgage.

Also, as e-mail respondent Devery Rodgers of Los Angeles was quick to note, “Whether it is a ‘great deal’ or ‘overpriced’ does not depend on finances [alone], but the value of the trip.” The costliest trip she’s ever taken was to Hawaii. “It was not the transportation, dining or lodging, but the tourist attractions [that] added value to the vacation,” she said.

Now back to the Joneses of Calabasas.

At first glance, they may look like big spenders. Charles Jones thinks it’s reasonable to spend 7% to 9% of one’s household income on a foreign trip. By his formula, members of a $50,000-a-year household would spend $3,500 to $4,500 on their biggest leisure trip of the year. But it’s important to note how he paid.

“It usually takes five to six months of making a conscious effort to save for our trip,” writes Jones, who describes himself as a senior who’s constantly on the alert for a good deal. “We do not take a trip unless it can be paid off in advance of our departure.” He also travels in winter “to pay less and avoid large crowds.”

Roy Williams, a Mar Vista resident who works at the California Map & Travel Center in Santa Monica, reported that a big trip to France last year took about 6% of his household income. Williams said he and his partner spent about $6,000 on three weeks in France (saving a few dollars by staying at friends’ houses in Normandy and Burgundy) and another week in New York on the way back.

As for saving up in advance, “we’re trying to do that now for Italy next year, but it’s not working,” Williams said. The France trip, like previous vacations, was paid for by credit card and paid off over time.

Bill Carnes, a reader in Cambria, wrote, “We have a travel account that we contribute to each month for just that purpose. To borrow for a trip would lead to eventual disaster.” He didn’t work out the numbers as a percentage of his income but said that on their last vacation, a driving trip to the Seattle area in spring, he and his wife averaged $190 daily (including gas in Oregon and Washington at the now enviable rate of $1.63 per gallon).

Carnes dismissed the idea that a couple could travel comfortably for much less than that. “If you stayed at Motel 6 and ate at Denny’s and didn’t drive a car,” he said, a couple might be able to get by on $141 per day.

As I noted in that previous column, that’s the average the Travel Industry Assn. of America (TIA) found in April when it surveyed 1,300 American households about their vacation plans for this year. The numbers boiled down to an average vacation trip lasting 8.3 days and costing $1,172 for everyone in the household.

Chances are that neither Carnes nor the TIA’s typical traveler will be bumping into Sarah Taylor on the road anytime soon.

Taylor, 20, hails from Sheffield, England, attends college in Wales--she’s studying tourism and French--and is spending this summer in Los Angeles. She estimates that this year she’ll spend 20% of her income traveling. Last year, when she circled the world, the figure was more like 50%. Next year, maybe 60%.

“I’m thinking of Indonesia and India,” she said. “And Canada. I’ve never been to Canada.”

Unlike the others who volunteered for this column, Taylor earns much of her income during her travels. Last year, on an extended trip, she found herself cooking in a Greek restaurant in Kalgoorlie-Boulder, a gold-mining town in western Australia. Here, she works the front desk of a hostel in Hollywood.

While on the road, Taylor said, she typically spends $15 to $20 nightly on lodging (the $30 motel room she took recently in San Diego was an extravagance) and $8 or $9 daily for meals. She eats fast food. Her biggest dining splurge in Los Angeles has been a $15 dinner at Lala’s on Melrose Avenue.

What do her parents say about her travel spending?

“There’s not much they can say. It’s my money. I earned it,” Taylor said. However, she conceded, “I have a lot of friends who think I’m absolutely insane. But they’re staying in England, working in offices. So who’s really insane?”

Christopher Reynolds welcomes suggestions, but he cannot respond to letters and telephone calls. Address comments to Travel Insider, Los Angeles Times, 202 W. 1st St., Los Angeles, CA 90012, e-mail chris.reynolds@latimes.com.