Don't break the bank for vacations

On Mondays, we answer questions from readers about personal finance matters. This past week, we had a question from @sarahedale on Twitter. You can find us on Twitter @family_finances

QUESTION: What percentage of their income do most Americans spend on vacations per year? What do you think is appropriate or safe?

ANSWER FROM DAN DANFORD: Sarah, a recent Gallop poll found that almost 60 percent of Americans who usually take a family vacation are planning to downsize or cancel this year. Together, that's an estimated $30 billion drop in travel spending this summer. Tough for the industry, but generally good for families wanting to travel.

Rules of thumb aren't much help here. Families differ too much in terms of income, size, geographic region, and personal taste. One family's summer trip to a Minnesota fishing lake doesn't compare well to another's annual pilgrimage to Cape Cod or Aspen. And other families consider any vacation an extravagance. There's little common ground for good comparison.

Here's what I can say. Bargains abound. No matter your preference of time, place, or amenities, costs will be lower than any time in recent memory. Hotels, resorts, cabins, boats, airfares, car rentals, and even para sail rides will available for remarkable savings. It's a buyer's market for summer vacations.

A couple of suggestions. Look for bargain vacation packages assembled to lure travelers. Use credit cards for booking, but pay them off or use cash when buying. Any savings will vanish against high interest rates. Last, don't go if you don't have the money. Vacations are about good memories. Don't try to manufacture good memories out of bad times. First of all, it doesn't work very well. Second, the struggle to pay later could damage any good memories.

Believe me, vacations are about time together, not fancy destinations. You can have a lot of fun without spending a lot of money. Especially this summer.