Receive free Personal Finance updates
We’ll send you a myFT Daily Digest email rounding up the latest Personal Finance news every morning.
Three-quarters of British holidaymakers who travelled abroad last year blew their budget for weekly spending by an average 38 per cent, underlining the impact of inflation in popular summer destinations.
The raised cost of meals and drinks emerged as a key factor in their overspending, according to research by Post Office Travel Money, the foreign exchange provider. Nine out of 10 parents quizzed in the survey spent an average of £310 on eating out or shop-bought food and drink over a week, having budgeted for £145.
The average spending on sightseeing was £87, while spending on treats for their children had risen by 35 per cent compared with their last overseas holiday.
Laura Plunkett, head of travel money at the Post Office, said: “Although sterling is at a 2023 high against European currencies, inflation has hit local prices abroad just as it has in the UK. This means families should expect to pay more for meals, drinks and other tourist items in most resorts.”
Surveying the costs of 16 different European destinations as schools in England prepare to break up for the summer holidays, the researchers said 15 of these places had seen price rises. But the biggest rises were in Turkey and Bulgaria, two of the places that remained cheapest overall.
Costs in Marmaris had doubled since last year because of inflation in Turkey — running at an annual 38 per cent in the year to June — and the impact of a volatile economy. But the researchers calculated that a fall of 64 per cent year-on-year in the value of the Turkish lira translated into a more modest 33 per cent increase in costs for British holidaymakers once local prices were converted to sterling.
At the other end of the cost ranking, Ibiza, Porec in Croatia, Lanzarote and Crete were the most expensive locations. Travellers will fork out 56 per cent more for day-to-day living costs in Ibiza than last year.
The research was conducted with Tui, the travel group. Richard Sofer, commercial director at Tui UK and Ireland, said demand remained strong for all-inclusive packages, as well as self-catering options that gave customers the opportunity for cost savings. “We’re also seeing some customers taper their holiday slightly, such as reducing holiday duration from 14 nights to seven, 10 or 11 nights.”
The analysis tracks prices of 12 items, from a three-course family meal, alcoholic and soft drinks, to ice cream, and the rent of a sun lounger or pedalo.
