Australia’s travel sector surges year on year as international alerts are downgraded

Aussies are changing the way they travel to save money, with one in four willing to travel off-season and one in six opting for domestic holidays over overseas trips.¹1Source: iSelect commissioned PureProfile to conduct an online survey during June 2026. The sample size is n=1,1016.

As Aussies digest debate around airline carry-on baggage charges,²2Source: https://www.jetstar.com/au/en/newsroom/jetstar-to-update-its-carry-on-baggage-model-aus new research from comparison service iSelect reveals the rising cost of living is already affecting how Aussies think about travel, with almost two-thirds (62%) admitting they feel guilty about spending money on holidays.

The findings show 29% of Aussies feel significantly guilty about travel spending, while a further 33% feel slightly guilty, highlighting the growing financial tension between wanting a holiday and managing household budgets.

Despite the pressure, Aussies aren’t ready to give up travel altogether. Instead, many are making compromises to keep holiday plans alive.

According to the research, almost one in four Aussies (25%) say travelling off-season is the number one compromise they’re willing to make to save money in 2026, while 16% would swap international holidays for domestic trips. Others are prepared to choose budget accommodation (14%), drive instead of fly (10%) or cut back on experiences while away (10%).

iSelect spokesperson Sophie Ryan said the findings demonstrate Aussies remain determined to travel but are increasingly looking for ways to reduce costs.

“The conversation around carry-on baggage charges highlights just how price-sensitive travellers have become,” Sophie said.³2Source: https://www.jetstar.com/au/en/newsroom/jetstar-to-update-its-carry-on-baggage-model-aus

“Our research shows that while Aussies still view travel as a priority, many are feeling guilty about the amount they’re spending and are actively looking for ways to cut costs without sacrificing their holiday altogether.”

“Rather than cancelling trips, travellers are making strategic compromises, whether that’s travelling outside peak periods, choosing domestic destinations or opting for more affordable accommodation.”

Sophie said additional travel fees, including baggage-related charges, can quickly add up and make comparing options more important than ever.

“When every dollar counts, it’s important travellers understand the full cost of their trip before booking, including any baggage fees, insurance costs and other extras that may apply.”

“While Aussies are clearly looking for ways to save money, it’s also important not to cut corners on things that could prove costly later, such as suitable travel insurance.”

iSelect’s top tips for finding suitable travel insurance

1. Consider the extras you might need – Most travel insurance policies will include a few low-risk activities, but not everything. If you’re planning on a cruise or something a little riskier, like a skiing trip or a jaunt on a scooter, it might mean taking out some extra coverage.

2. Make sure all your countries are covered – Even if you’re just passing through one country to get to another, it still needs to be listed on your policy. Skipping this step could leave you footing the bill if something goes wrong mid-stopover, like if your car gets some damage en route from Switzerland to Austria. If your insurer covers regions instead of individual countries, it’s important to double-check all the countries listed as well, to make sure you’re covered for 100% of your trip.

3. Declare any pre-existing conditions – If you have a pre-existing medical condition, it’s best to let your travel insurer know before taking out your policy. If it can be covered, it means you could claim for any related issues on your trip. And if you don’t declare it, any related claims could be knocked back.

4. Check the entry conditions for your destination – Some countries won’t let you in without a visa, while others need proof of insurance before entering. Make sure to check which requirements you need to tick off, like visas or certain levels of travel insurance coverage.

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iSelect General Pty Limited ABN 90 131 798 126, AFS Licence Number: 334115. Any advice provided by iSelect is of a general nature and does not take into account your objectives, financial situation or needs. You need to consider the appropriateness of any information or general advice iSelect gives you, having regard to your personal situation, before acting on iSelect’s advice or purchasing any policy. You should consider iSelect’s Financial Services Guide which provides information about our services and your rights as a client of iSelect. iSelect receives commission for each policy sold.