Higher gas prices and airfare costs are pushing many Americans to rethink summer travel plans, even as overall demand remains strong. According to AAA and Bank of America Institute data, travelers are increasingly adjusting budgets, shortening trips, or looking for lower-cost alternatives instead of canceling vacations altogether.
Millions of Americans are still expected to travel during Memorial Day weekend, traditionally considered the unofficial start of the summer travel season. Yet behind the record-setting projections lies a growing divide between higher-income households continuing to spend on travel and lower-income families cutting back as inflation pressures persist.
Travel experts say the summer season is not slowing down, though consumer behavior is shifting. Rising fuel prices, food costs, and economic uncertainty are influencing how people plan trips, where they go, and how much they are willing to spend once they arrive.
Rising Costs Are Reshaping Summer Travel Habits
AAA projects that45 million Americans will travel at least 50 miles from home between May 21 and May 25 for Memorial Day weekend. According to AAA vice president of travel Stacey Barber, that figure would surpass last year’s total of 44.8 million travelers and set a new Memorial Day record.
Most travelers will still choose to drive. Around 39.1 million Americans are expected to travel by car, slightly higher than last year. Barber told Yahoo Finance that road trips remain the cheaper option compared to flying, despite a sharp rise in fuel prices. AAA data shows the national average for regular gasoline was $3.19 per gallon during Memorial Day last year, compared with $4.53 this year.
Air travel is also expected to increase modestly. AAA estimates that 3.66 million travelers will take domestic flights over the holiday weekend. According to the report, many of those tickets were purchased before rising jet fuel prices began pushing airfare costs higher.
The broader picture across the United States is more uneven. Bank of America Institute reported that nearly four in ten lower-income households earning $66,000 or less do not plan to travel this summer. The institute’s card spending data also showed a year-over-year decline in travel-related spending among those households in 2026.
At the same time, middle- and higher-income households have increased their travel spending. According to Bank of America Institute data, consumers earning between $66,001 and $130,000, along with those earning above $130,000, continue to spend more on vacations despite rising prices.
Travelers Are Adjusting Plans Instead of Canceling Trips
Economic pressures are also affecting household finances beyond travel spending. According to the Federal Reserve Bank of St. Louis, the U.S. personal savings rate has fallen to 3.6%, its lowest level since 2022, as more Americans rely on savings and credit cards to manage daily expenses.
Even so, relatively few travelers are abandoning summer vacations entirely. Bank of America Institute senior economist David Tinsley said most people are modifying plans rather than canceling them. Roughly one in ten travelers reported scrapping a trip altogether, while others are reducing the number of trips they take or spending less on accommodations and extras.
The report also found that about half of travelers have already booked summer trips, up from 38% during the same period last year. According to Expedia Group travel expert Melanie Fish, travelers are increasingly staying closer to home or choosing destinations where costs stretch further.
Cruises have emerged as one of the more cost-conscious options this summer. Cruise spending increased across all income groups during the first four months of 2026 compared with the same period a year earlier, according to Bank of America Institute data. More than one-third of Americans also said they plan to take a cruise within the next 12 months.
Gene Sloan, cruise team lead at The Points Guy, told Yahoo Finance that cruise operators continue offering promotions and discounts while airlines raise fares and reduce flights when demand softens.
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