Holiday budgets slashed as parents feel the squeeze

British parents are responding to increasing costs by slashing their summer holiday budgets, according to research from Abbey Credit Cards. Despite rises in inflation, the expected total school holiday spend has dropped by around 600 million GBP, from 4.8 billion GBP in 2007 to 4.2 billion GBP in 2008.

For the average British family, that's a cut in summer holiday budget of 173 GBP- from 749 GBP in 2007 to just 576 GBP this summer. The average is brought down because while slightly more people are planning to go abroad, a quarter of families compared to 19 per cent last year, the average budget for a foreign family holiday has dropped massively. Last year people spent 1,116 GBP on taking their children overseas but this year only plan to spend 493 GBP on average.

Day trips and eating out with the kids have seen a slight revival, with expected spend on these higher than last year. However this increase is wiped out by the cut in expected spend on toys, hobbies, sports equipment and home entertainment. However, one thing British kids will get more of is quality time with mum and dad - childcare budgets for the summer have also been dramatically cut from 180 GBP last year to just 31 GBP this year.

Callum Gibson, Head of Abbey Credit Cards, said: "With rising inflation it is remarkable to see an overall cost drop like this, but it just shows how British parents are feeling the pinch. One thing that has seen a drop-off is the amount people plan to spend on their holiday abroad. With a budget of less than half last year's amount, the one thing that British holidaymakers definitely don't need is for that budget to be further eroded by foreign exchange charges overseas. With Abbey's Zero card you pay no fees for foreign exchange or cash advances, meaning your holiday budget is spent on the right thing!"

Abbey Credit Card top tips for a cheaper summer

The school holidays can be expensive, but they needn't be. Abbey has some top tips for people looking to entertain the kids cheaply this summer:

Visit a museum - many are free
Fly a kite - make your own (there's certainly enough wind about)
Create some driveway art - all you need is chalk (and then some warm water and Fairy Liquid (TM) to clean it up afterwards)
Make bubbles - that good old Fairy Liquid (TM) again
A cooking lesson - spaghetti has never been so much fun
If you're going overseas, make sure you pay for things with an Abbey credit card to avoid being charged fees