The Weak Dollar is Making a European Vacation Harder to Afford in Retirement
Travel pros explain how you can afford a European vacation in retirement despite a weak dollar.
Many people dream of traveling extensively in retirement. Europe tends to be a popular destination, in part because many countries are easily accessible to one another.
The continent boasts a sophisticated railway system, allowing retirees (and travelers in general) to take a single flight and visit multiple countries. When the dollar is strong, a European vacation could, in some cases, be more economical than traveling domestically, especially during peak seasons.
But that’s not the case today. The Wall Street Journal (pay wall) says that the dollar’s decline during the first half of the year against peer currencies was the steepest in more than half a century. The dollar is down 13% against the euro, making it harder for retirees to travel to Europe.
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If you’re a retiree who was hoping to take a European vacation this year, you might run into issues with what you can afford, but that doesn’t mean you must abandon your plans completely.
Get off the beaten path
European hotspots such as Italy, Spain and France tend to be expensive even when the dollar is stronger. If you’re a retiree with a limited travel budget, you might want to consider visiting less-traveled corners of Europe. Your money might go further, and you could benefit from smaller crowds.
Kendra Guild, vice president of North America at Solos Holidays, a tour operator that arranges group tours for solo travelers with a particular focus on people age 50 and older, says, “We’re definitely seeing how economic uncertainty is reshaping summer travel plans this year. People still want to get away, maybe more than ever, but there’s more hesitation around making big financial commitments.”
Guild says one way travelers are pivoting is sticking to their top destinations but taking shorter trips that are more affordable. If you’re willing to pack in a lot of sightseeing, shortening a trip means spending less on lodging and food while you’re abroad. That could produce considerable savings.
Guild also says travelers to Europe are now more open to new locales.
“We’re also seeing a shift in destination demand,” she says. “There’s growing interest in more off-the-beaten-path regions like Umbria or Puglia in Italy, the Alsace region in France, lesser-known islands and the mainland in Greece, and the Baltics. These destinations offer incredible food, history, culture and scenery — but at a slower pace, often with fewer crowds and a lower price tag.”
Guild says she’s also seeing a lot of interest in Albania.
“The country boasts diverse landscapes, from beautiful beaches along the Ionian and Adriatic Seas to the rugged mountains of the Albanian Alps. Its affordability makes it an approachable destination to enjoy the best of the Adriatic Sea at significantly lower prices than neighboring Greece.”
Get creative to find cheaper travel
It’s easy to get stuck on a specific vision for a European vacation. But with a weaker dollar, you might need to get creative, says Domenick D’Andrea, Co-Founder and Financial Advisor at DanDarah Wealth Management.
One thing he suggests is traveling at off-peak times during the year. “You may be able to get back on budget and still have your dream vacation.”
D’Andrea also suggests reassessing your lodging options. A hotel might seem optimal, but renting an Airbnb with a fully stocked kitchen could not only be cheaper on a nightly basis, but help you save money on food costs.
Additionally, if you’re willing to do some research and get familiar with local public transportation, you may be able to save money by exploring different cities and attractions on your own rather than paying for a tour.
“There are many free excursions in Europe,” D’Andrea says. “You could also find local restaurants instead of the tourist traps.”
You might have more leeway than you think
A European getaway might seem undoable right now, and you could be inclined to put off your dream trip.
You definitely don’t want to strain your finances or incur debt to take a big trip, D’Andrea says, but remember that good health is never guaranteed. Instead of giving up on Europe, there might be a way to make things work.
“If you still want to have the trip that you have always planned for, and it is still over budget, I suggest sitting down with your financial adviser to see if you can move things around,” D’Andrea says. “This could mean that maybe next year you don’t travel, or you cut back on some other expenses.”
D’Andrea says don’t write off the option of boosting your income. “Maybe get a part-time job to help make up the difference.”
It’s hard to know when the dollar will regain its strength and when Europe will become more affordable for U.S. travelers. If you’re in good enough health to take the trip now, it might be worth making other sacrifices to pull it off.
As D’Andrea says, “With proper planning, research and working with the right professionals, you can find a way to make it work.”
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