Cost-conscious Canadians choose staycation over vacation

Cost-conscious Canadians were more than twice as likely to spend their summer vacation close to home than go abroad, a new survey by BMO found.

Forty-three percent of respondents said they were spending on local entertainment, compared with just 17% who said they were planning a trip abroad, the online survey of 1,522 Canadians conducted between Aug. 2nd and Aug. 4th found.

The “staycation” trend was far more prevalent amongst the older generation with 47% opting to stay at home. Among younger Canadians about 57% said they spent their summer cash on leisure activities.

“Staycation”was included for the first time as one of 2,000 new words added to the Oxford English Dictionary in its new edition last week. It coins a term that became popular as the recession bit for people to spend their time off at home rather than going away.

Canadian travel abroad dipped 1.1% in June on fewer trips to the U.S., according to the latest figures from Statistics Canada.

Canadian residents took 3.6 million trips to the United States in June, down 1.7% from May. Same-day car travel declined 1.6%, while overnight travel by Canadian residents to the United States decreased 2.0%, it said.

The dip in overseas travel coincides with increasing reluctance to spend as concern about the global economic recovery mounts.

Retail spending data released earlier this week showed an unexpected slowdown in June as the faltering global economies hit consumer confidence causing them to tighten their purse strings.

Other findings from the BMO survey showed that 38% of people in the Prairies opted to spend their disposable income in summer months on going to restaurants and bars compared with just 25% in Alberta.

While in terms of who is footing the bill, the survey showed 38% of men were spending on bars and restaurants compared with 30% of women.

BMO says for those not wanting to “staycation” next year, there are several easy tips to help save more money.

It recommends setting up an automatic transfer on payday each month to a high interest savings account. Just $50 a week would add up to $2,600 not including interest in one year.

It also recommends cutting back on discretionary spending. About half of Canadians say they spend spare cash on dining out, with 20% spending on morning lattes.

“Reducing these types of expenses and putting an automatic savings plan together can mean the difference between another family staycation or lying poolside in the Caribbean,” said David Heatherly, Vice-President, Payment Products, BMO Bank of Montreal.