U.S. Holiday Travel 2025: Strong Demand for Domestic Tourism Amid Tighter Budgets

Published on November 24, 2025

As the holiday season approaches in 2025, Americans are planning to hit the road and the skies in large numbers. Despite tighter budgets, U.S. holiday travel remains strong, with more than half of the population planning to travel between Thanksgiving and the New Year. According to Deloitte’s 2025 Holiday Travel Survey, 54% of Americans intend to travel during the holiday season, but many are cutting back on expenses. While this increase in travel is a boost for the tourism industry, it signals a shift in how people are spending. For tourism operators, understanding these changes is key to attracting more visitors, despite the smaller budgets.

The Deloitte survey also shows that while 54% of travelers plan to venture out, the average spending has dropped significantly. In 2025, the average budget for holiday travel is approximately $2,334, down by 18% from the previous year. This decline in spending is felt most acutely among high-income households, with 19% of those earning over $100,000 reporting feeling financially worse off than a year ago. As a result, these travelers are shortening their trips and opting for more economical travel options. This trend is reshaping the landscape for tourism providers who are now adjusting their offerings to cater to these budget-conscious visitors.

One of the most significant shifts this year is the move away from flying and toward road trips. Only 47% of travelers plan to fly for their longest holiday trip, compared to 55% last year. This change in travel behavior is a crucial opportunity for tourism destinations that are easily accessible by car. Cities and regions that cater to road trips are seeing a rise in short-distance tourism. This trend not only supports local businesses, such as motels, local attractions, and restaurants, but it also allows destinations to tap into a broader audience, including families and weekend travelers looking for budget-friendly vacations.

Accommodation choices are also being influenced by travelers’ desire to save money. According to the survey, 63% of travelers prioritize price when selecting a place to stay. With a decrease in overall spending, hotel brands and destination marketing organizations (DMOs) need to rethink how they market their properties. Instead of focusing on luxury or high-end experiences, emphasizing value-added services, loyalty programs, and affordable packages will be essential in attracting customers. The rise of shorter stays also signals a preference for budget-friendly accommodations such as boutique hotels or vacation rentals over traditional resort stays.

Tourism-related spending is also seeing a shift. Many visitors are choosing to spend less on attractions, tours, and activities. While fewer travelers are booking premium experiences, local businesses can still benefit by offering budget-friendly and accessible experiences. For instance, regional attractions like hiking trails, local food markets, and outdoor events are gaining popularity. Tourism operators who focus on providing low-cost yet memorable experiences are well-positioned to succeed in this environment.

The trend towards tighter budgets and shorter trips is also evident among younger generations. Millennials and Gen Z, who are increasingly dominant in the travel market, are cutting back more than older generations. Gen Z, in particular, is reducing its travel budget by 31% compared to last year. Despite this, these younger travelers are still eager to explore new destinations, often turning to social media and AI tools to plan and personalize their trips. Destinations that cater to these tech-savvy travelers with customized, budget-friendly options are likely to see continued success.

For international travelers, the forecast isn’t as promising. The U.S. Travel Association has noted a slight dip in international tourism, with a reduction in spending from overseas visitors expected to be around $12.5 billion in 2025. However, domestic travel remains strong, and U.S.-based destinations can leverage this opportunity to showcase what they offer to local and regional visitors. Local marketing efforts and promotions designed for domestic tourists will be key in sustaining growth in the tourism industry.

As tourism professionals prepare for the holiday season, they recognize the need to adapt to the changing demands of travelers. The key to thriving during this period is flexibility. Tourists are looking for affordability, but they still want memorable experiences. Offering package deals, free cancellations, and a focus on value for money will make a big difference in ensuring a positive experience for travelers. Additionally, providing local experiences—such as community festivals, cultural events, and affordable sightseeing options—will help drive interest and bookings.

The U.S. holiday travel outlook for 2025 offers both challenges and opportunities for the tourism industry. With more travelers seeking budget-conscious options, destinations that can provide value, flexibility, and authentic experiences will emerge as winners. While premium spending may be down, the volume of travel is high, ensuring that the tourism sector remains a vital contributor to the economy. By focusing on what travelers want most—affordable, accessible, and enriching experiences—destinations across the U.S. can make the most of this year’s holiday travel surge.