Vacationing in the Backyard

July 4, 2008— -- For the first time this decade, the number of Americans traveling for the Fourth of July is down. Half a million people who traveled last year will be staying home.

Instead of taking an elaborate family vacation this summer, for instance, Heather Lavine, a mother from Waxahachie, Texas, scrapped her travel plans and bought her kids a $200 pool from Wal-Mart. She placed it right in the backyard of their home, which is located across the street from the source of their woes: a gas station.

"I think we'll be having that pool again next summer, I really do," Lavine said. "I think gas is just going to keep going up, and with gas going up, groceries are going to go up and then you have heating bills that are going to go up."

Sky-high gas prices are largely to blame. Gas prices have skyrocketed to more than $4 a gallon and a recent report predicts that it could increase to $7 a gallon within two years. Oil hit a new record Thursday, closing at more than $145 a barrel, up $1.72 from the day before. Given today's economic reality, families like the Lavines are staying local.

In Jackson, N.J., Allison Valenti and her family canceled their summer vacation, instead opting for the local amusement park.

"I like to take them to see other places, but unfortunately, this year we're going to have to pass," Valenti said. "This year we're staying right in New Jersey because the price of gas is just too high. I'm still paying my oil bill from the winter."

Dena Gardner and her family rented a cabin one town over, only a mile and a half away, from their home. They too had to cancel travel plans, to North Carolina, due to high gas prices.

"We're camping out around the corner," she said. "The kids don't know the difference. Let them play in the dirt, and they're happy anywhere they are."

While gas prices have nixed travel plans for many, others are saving money by skipping the traditional hotel and pitching a tent instead. Campgrounds across the country are reporting higher visitor volume.

Tim Leffel, travel expert and author of "Make Your Travel Dollars Worth a Fortune," has some other tips to save money away from home.

"My main piece of advice is to get to those places in your backyard that you've been meaning to and haven't because usually there are a lot of great deals out there within 100 miles or 200 miles of where you live," Leffel said.

"I think people are happily surprised a lot of times of what's in their backyard once they start looking around."

Vacationing this summer is possible on a budget, if you take advantage of special offers, look for discounts and think outside the box:

If you are flying, and flexible about your destination, sign up at Web sites that alert you to last-minute low fares.

If you are driving, sites like AAA can calculate how much your trip will cost and where to get the cheapest gas.

When booking hotels, be aggressive about discounts from organizations like AAA and AARP. Or consider enrolling online to swap houses with people in another city.

Great Holiday Sales

Despite the tough economy, major sales are as common as fireworks today, and as the weather gets colder, the deals will only get better as retailers aggressively pursue deals and promotions through this weekend and into the fall.

This summer expect to see rebates, discounts and even 18-month no interest payments. After people spend their stimulus checks and tax rebates, retailers will be aggressively courting consumers. Soon gas grills, lawn furniture and appliances will be going on sale as retailers prepare for fall by dumping their summer inventory.

On ABC News this morning, Wendy Bounds, "Good Morning America" contributor and editor at the Wall Street Journal, said Circuit City will be offering $300 off a 41-inch plasma TV, $100 off a laptop and $50 off a GPS device. At Sears, you will find 20 percent to 30 percent off appliances. Lowe's promotions include a gas grill that comes with a free tank of propane.

And for the fashion forward, Bloomingdale's and Macy's are discounting already on-sale merchandise.

Carmakers will also offer sweet deals. But prices will remain high on home goods and alcohol.

"People are looking for ways to scale back without completely giving up their vacations," Leffel said. "I think most people realize it's inherently important to have that down time and to get away from work and to get out of your house and go do something else without spending a fortune."

As Gardner's family prepares camp, she remains upbeat, despite vacationing in the next town over.

"Well, I have to admit, I'm going home to my own bed tonight, so I can afford to be chipper," she said. "The rest of them are roughing it, I'm going home."

Even budgeting has a bright side.