How to Avoid Summertime Debt

It’s hard not to sit back, relax and enjoy the sounds of summer, from the local ice cream truck slowly crawling through the neighborhood, to freshly cut grass and kids playing, water being splashed and the outdoor grilling at its finest.

But the positives of summer, and there are plenty, often come at a price.

For most, summertime isn’t just about vacations, outdoor fun and festivities, hot dogs and hamburgers on the grill, but also a propensity to overspend and subsequently rack up enough debt and distress to last through the end of the year.

This isn’t so much a discussion about the plight that is summertime spending and lack of saving but more so understanding how to avoid it, what traps or pitfalls you may run into, and how to truthfully enjoy the summer months, the warm weather and all those sounds and smells, minus the fear of falling further into debt as a result of those “good times.”

The summertime numbers suggest a few things when you look at them closer: we know we rack up debt and spend more in the summer, and you end up frantically trying to recover those losses as a result.

Approximately 66 percent of those polled say they spend more on a week-long vacation than they do for one month’s rent, and on average you’ll rack of around $1,1000 for a vacation.^[1]

Vacation is just one aspect of summer and spending too much.

Other functions, holidays and such (think July 4 parties and the close out to summer, Labor Day) also play a part in wanting to spend more, as well.

The reason behind the “why” as far as what triggers us to spend really centers on the family and friends piece, getting together and having fun, and doing it as the expense of being smart on how you make decisions.

Consider, even outside of the summer months, going out to dinner.

Most of the interaction isn’t so much about the food, drinks or what you’re eating but rather the social piece. Going out to dinner on average can cost you $20 per person or more, and the real reason you wanted to go was more about friends or family, and spending time with them.

The same principle applies to the summer.

The overspending in the summer is equally disheartening when you consider how poorly the financial acumen is of most, and what shape the general public is in.

Half of the American population say expenses are higher than their income, with 54 percent being the highest expenses to income ratio for ages 18 to 25; not surprisingly nearly 100 percent polled (96 to be exact) are stressed about it.^[2]

The stress isn’t surprising but also is a huge red flag.

Consider summertime and the vacation season being a big driver as to why we take time off, spend money on hotels, flights, travel, etc. because, ironically enough, we’re stressed about money.

This is backward thinking, but in some perverse way, understandable.

The idea, however, that you’re going deeper into debt in the summertime by overspending because money is an issue simply doesn’t make sense.

The average household, right now, carries $15,000 worth in unpaid credit card debt, so how is adding an extra $1,000 going to help at this moment.^[3]

It won’t.

Sure, the sunshine of vacation or going crazy with money spent on new landscaping, painting, outdoor projects or just hitting the July 4 sales hard for grills, mowers and moss will take your mind off your financial plight, but much like summer, only lasts for so long.

Here are a few solid ways to avoid overspending in the summer, and tips to save in the month when most are spending wildly.

Save early, enjoy the summer: Vacations, spending should be accounted for

Vacations undoubtedly account for the bulk of summertime spending.

Mindless booking is something you simply can’t afford to do.

This would be the type of vacation planning with little rhyme or reason to it, not thinking through how to get the better deal and most importantly saving money for the trip itself in January, rather than charging it on a credit card or borrowing money just to take a trip.

A recent study showed that 8 out of 10 people book an entire vacation on their savings alone, a positive thought when you consider the $15,000 figure mentioned previously for household debt.^[4]

This suggests we’re avoiding spending on our credit cards, but the average savings account for most is under $1,000 so charging vacations has to come into play, too.

Roughly 32 percent of the population charges vacations to credit cards.^[5]

In addition to avoiding spending on your credit card for a vacation, you also have to ensure your timing is right, too.

Price comparisons and matching has various web sites battling for your dollar for this summer, so why not take advantage of it.

A site such as booking.com has hotels for $200 or less and is one of the more pinpoint sites you can find because their dollar amounts don’t have hidden fees, for instance.^[6]

Most of the fanfare and marketing centers on the Priceline and Cheap Tickets sites, and they’ll play a part in finding you the lowest fare on hotels, car rentals, flights, etc.

Even the day of the week is part of the decision making if you want to avoid overspending and racking up summertime debt.

Most statistics show that Sunday is the best time to secure a flight, along with Tuesday.^[7]

Unlike flights, hotels are a little easier, timing wise.

The general rule of thumb is you should be booking a hotel about 30 days before your trip.^[8]

The 30 days is a welcome number for summertime travelers who are inclined to book in June, leaving July as a prime month to secure a hotel at a better rate, particularly if you’re driving and booking a flight becomes a moot point.

Look for free activities in summer: You’ll still get the best of the season, minus the cost

What is one of the main reasons people overspend on vacations?

They feel like they “have to.”

Whether that’s renting jet skis, eating dinner out at a restaurant every day or getting caught up in tourist attractions that are costly, such as zoos, theme parks, etc. are just part of how we end up doing outstanding in planning the trip on a budget, then come home light by thousands of dollars.

Consider that $60 per adult and $45 per child under 10 per day is what you’ll need for vacation, along with $35 to $50 for beverages.^[9]

Those figures add up, and so too will you debt this summer.

Saving money in the summer isn’t unheard of, either, and you can do that with activities that are fun and, more importantly, free.

Community swimming pools, public beaches or parks are a fantastic way to take in the scenery, enjoy cooling off and even packing a picnic lunch all for pennies versus the costly hotels, flights and tourist driven beaches that are going to ask you to shell out $20 for a water and ice cream cone.

When you look at the an average salary of about $50,000 per year, about half of those individuals say they can’t afford a vacation, and plan on staying home.^[10]

The other aspect of having a “free” summer is the “stay-cation” or simply taking time off, relaxing, catching up on around the house outdoor projects and avoiding spending money altogether on a trip, per say.

And if you can’t decide if you want to take a trip, join the club. Forty-two percent of the population last year said they opted out of a trip, but procrastination proved costly, with 35 percent of the people at the start of summer not knowing travel plans or if they’ll leave for vacation at all, with just 22 percent saying they booked a trip.^[11]

Cut costs where you least expect: From summer camps for kids to sales, you can save

Summer isn’t just about vacations or not vacationing but also can focus on Memorial Day sales, July 4 sales and even Labor Day sales (imagine 3 big sales through the entire summer, and you’re not sure what to buy, if anything).

Consider that some sales are better than others, such as making sure you do your back to school shopping in as part of a Labor Day sale, with avoiding the temptation to spend in August on clothing, for example and wait a few extra weeks to get kids’ clothing at a better price.

If you want to spend money and save with back to school, try buying a laptop in August when electronics are at an all-time low.

Kids and going to camp is also an expensive part of summer.

Camps can run as much as $304 per week, with some up to $1,000 per week.^[12]

You might want to rethink that expense, even if it means kids staying closer to home and perhaps involving themselves in a camp that one, isn’t all summer or two, is free or at a better cost per person.

Here’s another summertime savings hidden gem: cancel your cable.

You are spending so much time outside, why not cut the cord, save money each month and live on DVD’s or Netflix or some other streaming service.

The average cable bill is $100 and has increased in a four-year span from 2011 to 2015 by 39 percent.^[13]

That $100 can be used for the next four months and put toward back-to-school shopping or toward next year’s vacation.

Summertime, and the living should be easy.

For some, swinging back and forth on a hammock for free or just relaxing and letting the sun (also free) hit your face is all they need to define this season.

Others, as noted, tend to equate parties, fun and friends with money and spending it for a multitude of reasons.

Rather than mortgage your financial future for a few months, consider tempering your spending with either enjoying summer with zero dollars at stake (i.e. free), buying and purchasing what’s on sale or planning a little better when you’re putting together and paying for a summer vacation.

The average vacation for a family is $4,700, so if you’re spending that, you had better be saved up or prepared to spend (not charge) this trip with little or no long-term ramifications on the table.^[14]

Despite growing financial concerns about saving money or adding debt, as of last year, roughly 1 out of 3 people planned on taking a summer vacation more than 50 miles away from their home.^[15]

That says we’re going somewhere, but maybe you can reconsider where, and how much it will cost?

Just because summertime and spending run hand in hand with one another doesn’t mean you have to equate money to enjoying June through August. Instead, look for ways to minimize spending, maximize your enjoyment and do so that when Labor Day rolls around, and the leaves are hitting the ground that your jaw isn’t as well once you’re stuck repaying for a summer you’d like to start over.

Keep reading with: Why These After Christmas Sale Items Can't be Ignored