With the cost of living soaring, now might be the perfect time to book a holiday

It’s probably a game of cup to try to make travel predictions after what’s happened in the past two and a half years. But that’s what anyone planning a trip this fall or winter, or even looking further afield in 2023, is faced with.

First, of course, you have to figure out if you can afford to travel, given the latest economic news and the terrifying rise in energy prices. (Although you might think that a few weeks in southern Spain in, say, November would save you so much on your home heating bill that it would actually be more of an investment than an indulgence).

Then you have to decide if it’s best to book now or wait and see what impact the recession might have. The problem with this judgment is that the factors that affect vacation prices and availability are so volatile and their impact is so unpredictable – especially right now. Energy prices and inflation could continue to soar. But while this would tend to drive up prices, it could sharply reduce demand, which could have the opposite effect.

On the other hand, there could be some long-awaited good news from Ukraine that could drive down energy costs. This could produce a boost in confidence that would make tour operators and airlines more optimistic about the prices they could charge.

Fortunately, I think the math is simple. One of the main advantages of travel is that it is possible to fix a large part of the cost in advance. If you’re sure you want a vacation and can find one at an affordable price, you’ll almost certainly do well to book and lock in that price now. Once you have booked and paid for your flight, an airline will not come back to ask you for more money, nor will a hotel. Granted, you can miss out because you book and then find the prices go down – but that seems a pretty unlikely scenario at the moment (except maybe in really low season, like winter sun and ski holidays early December).

It is also true that there is a slight risk of price increases when it comes to package holidays, even after booking. Tour operators have the legal right to charge you extra for your holiday if their costs increase. Not just by putting sale prices, but by sending you an additional invoice – or a surcharge – even after you have booked and paid.

Under UK law, however, there are strict rules on how and when an operator can do this. And those reasons are limited to a drop in the value of the pound, higher taxes and increased fuel costs. General inflation is not a reason they can give. And if a surcharge is more than eight percent of the holiday cost, you have the right to cancel for a full refund. (If the company is a member of Abta, it must also absorb the first two percent of any increase). Granted, even these rules mean you could be charged an extra £320 for a £4,000 holiday, but at least you can get your money back if that’s too much.

Finally, if you book, make sure your money is protected – either through the Atol scheme (caa.co.uk/atol-protection) or travel insurance which includes financial failure cover.

Important Credit Score News

A key factor for some people in deciding whether or not to book now is the situation with credit notes issued for vacations canceled during the pandemic. Last week, the CAA said the value of unspent refund credit notes that have been issued under the Atol protection scheme currently stands at more than £54million. But it will not extend this protection. If a travel company goes bankrupt after September 2022, consumers with outstanding refund credit notes will no longer be covered and risk losing the money they have already paid if the company they booked with goes bankrupt. . To avoid this, you must use the voucher to make a reservation or request a refund.

Are you planning to book a holiday for later this year or next? Or do you prefer to wait closer to the time? Let us know, with your reasons, in the comments below.

About George Dailey

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