Are Vacation Packages the Best Travel Deals?

by Ann deBruyn

Wanting to travel but not sure where to start? Vacation packages may seem like an appealing option, especially since they can bundle together multiple bookings at once. But are travel packages a good deal?

Let’s take a look at the costs of booking travel packages, how they compare with separate bookings and how much you could save by redeeming rewards points.

Costs of booking vacation packages

There are a lot of moving parts when booking a vacation, especially when it comes to your travel itinerary. Plenty of websites offer the ability to book travel packages, but one of the more popular options is Costco Travel. Costco Travel vacation packages are available exclusively to members, though members can book them for others without the need to travel.

Costco’s travel packages can include flights, cars, hotels, theme park tickets and additional activities.

Here’s an example of a weeklong vacation for two adults to Walt Disney World  in Orlando, Florida, including flights, a hotel and theme park tickets:

tips for booking vacation packages and getting good travel deals - costco travel

Your total out-of-pocket cost is $2,113.11, which isn’t bad for a vacation that includes Disney World admission. Keep in mind, however, that you’ll also be on the hook for Costco’s annual membership fee, which starts at $60 per year.

Other options for travel packages include airline websites such as Delta Vacations, American Airlines Vacations and United Vacations. However, not all travel packages are created equal.

Nerdy tip: Booking vacation packages on airline websites allows you to redeem your miles toward travel.

Here’s the same vacation through the Delta Vacations website, though this package doesn’t include theme park tickets. (Note that the cost listed is per person.)

tips for booking vacation packages and getting good travel deals - universal holiday inn

Since theme park tickets aren’t included, you’ll need to purchase them separately.

tips for booking vacation packages and getting good travel deals - disney

In this case, booking through Delta Vacations will cost you a total of $2,463.94 — a full $350 more than the identical package Costco Travel is offering. Those wondering "Is Costco Travel a good deal?" can answer a resounding yes in this scenario.

Costs when booking separately

So we’ve seen the difference in price for varying vacation packages, but what about when you book each item separately?

Here’s the same flight featured in those travel packages, which will run you $374.40 for two people.

tips for booking vacation packages and getting good travel deals - delta air lines

Note that these tickets are  main cabin  fares, not basic economy, which means you’ll get seat assignments and standard boarding. Basic economy tickets are cheaper but lack these features, among other restrictions.

A seven-night stay at the Holiday Inn Suites across from Universal Orlando will cost $993.41.

tips for booking vacation packages and getting good travel deals - holiday inn orlando

Finally, you’ll want to add in those Disney World tickets for $1,225.10.

All told, your Orlando vacation would run you $2,592.91, which is more than either travel package offered by Costco Travel or Delta.

As you can see, booking a travel package can save you money — and in some cases the difference is significant — so when does it make sense to book separately? Short answer: when you care about elite status at a travel loyalty program.

Nerdy tip: Check the rates of all major hotel chains, such as Marriott, Hilton, Hyatt and IHG, to find the best lodging rates before booking.

Frequent travelers will be aware of hotel loyalty programs , which reward repeating guests with amenities such as complimentary breakfast, room upgrades, early check-in and late checkout. However, these loyalty program member benefits don’t apply to stays booked through third parties, which generally include those within travel packages.

If you have top-tier elite status, you could be missing out on hundreds of dollars' worth of perks by booking through a third party.

Costs when redeeming travel rewards points

There’s another option for value-seekers looking to save money, and it comes in the form of travel rewards . Points and miles can be redeemed for flights, hotels and even theme park tickets, drastically dropping the cost of your vacation.

In keeping with the above example, here’s the cost of that flight in miles when booked with Delta SkyMiles .

tips for booking vacation packages and getting good travel deals - delta

You’ll be paying 24,000 miles round-trip for two passengers, plus $22.40 in taxes and fees.

IHG has dropped its award chart in favor of dynamic pricing, which means you pay variable figures depending on the night. For our example trip, your total would be 121,000 IHG points — though if you're an  IHG® Rewards Club Premier Credit Card holder, you could expect to save some points because of the card's Fourth Reward Night Free discount.

tips for booking vacation packages and getting good travel deals - ihg

And although you can’t use your rewards points to directly purchase Disney tickets, you can take advantage of a purchase eraser card, such as the Bank of America® Premium Rewards® credit card , to apply your points as a statement credit toward the purchase.

tips for booking vacation packages and getting good travel deals - disney

In this case, you’d be redeeming 122,510 points at a rate of 1 cent each to pay for your tickets.

Nerdy tip: Disney ticket purchases don’t typically code as travel — but there's a way to do so if you book a vacation package from Disney or buy tickets through a site like Undercover Tourist. This makes them eligible for the travel purchase eraser offered by cards like the Capital One Venture X Rewards Credit Card .

All in, you can build this Disney vacation for around 267,510 points and $22.40 in taxes and fees. Even better, elite members would be eligible for all the benefits and credits they’d normally receive.

There’s a cost associated with earning rewards points, but travelers can take advantage of credit card welcome offers to earn large lump-sum amounts of points. For this example, acquiring three different credit cards would almost entirely cover the cost of your vacation:

If you want to get good deals on vacation packages

Planning a vacation can get overwhelming very quickly, which can make travel packages a particularly compelling option. These packages can provide a great deal — and convenience — compared with separate bookings. Even so, those pursuing elite status with their preferred travel loyalty programs should stick with booking directly to get credit for their purchases and access to the perks.

Those looking to save as much money as possible can plan well in advance to get the right credit cards — at least six months ahead of your trip is recommended . Then, you can redeem points and miles for deeply discounted vacations, no matter where you're traveling.

To view rates and fees of the Delta SkyMiles® Gold American Express Card , see this page .

How to maximize your rewards

You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2022 , including those best for: