American Express

American Express

December 07, 2011 12:18 ET

Generation Gap: 2.5 Million Young Adults Plan Gap Year Exodus Overseas as Parents Use Cards to Provide Financial Protection

- A Third of Young Adults Plan to Take a Gap Year Within Next 12 Months

- Running Out of Funds is Biggest Concern for Gap Year Travellers

- Supplementary Cards Ideal for Financial Support Abroad

LONDON, UNITED KINGDOM--(Marketwire - Dec. 7, 2011) - New research by American Express Platinum Charge Card has revealed that the nation is set to see a 'Gap Year Exodus' this year, with over a third (34 per cent) of teens and young adults planning a Gap Year trip within the next 12 months(1). That's the equivalent of 2.5 million 16-24 year-olds across the UK(2).

The exodus has been further exacerbated by the fact that a large number of students will not be starting their university course this year as planned. While 700,000 teens/young adults applied for full time university places this year(3), the research found 16 per cent of applicants missed out on a place, were turned down or deferred their place. As a result, 43 per cent of these are more inclined to take a Gap Year as a second choice to university, and a further 37 per cent will follow suit if they struggle to find a job.

Plugging the Financial Gap

Fear of running out of funds while overseas is one of the biggest concerns for those planning a Gap Year. But while more than half (56 per cent) have budgeted for major expenses, a quarter (25 per cent) of travellers have a more relaxed approach and have not budgeted at all, instead they plan to "see how it goes" when abroad.(4)

While the majority of these travellers (58 per cent) will finance their trips independently using savings or money they have earned, nearly a quarter (26 per cent) will have some parental help and 11 per cent will see their entire trip paid for by Mum and Dad.

Who to turn to in an emergency

Of those looking to travel within the next 12 months, the majority (47 per cent) would ask their family for assistance if they had a financial emergency during their trip. Interestingly, Mum and Dad rank higher than the British Embassy when it comes to where travellers would turn first if they ran into trouble overseas, be that losing their passport or falling ill.

As such, one in ten parents have already set their children up with a supplementary card (a card tied to a parents account) to ensure they have access to funds in an emergency. Indeed, as well as financial support, supplementary cards can also provide much more overarching cover for Gap Year travellers.

John Paasonen, Director of Charge Cards at American Express, said: "Supplementary cards are a great tool for both travellers who encounter an emergency and parents who want to ensure their children have a safety net while away from home.

"Parents of young adults using one of our Platinum Charge Supplementary Cards can rest easier knowing that, in addition to having access to funds in the event of a financial emergency, they are also covered by a range of additional benefits including worldwide Gap Year travel insurance and support from our dedicated international emergency assistance service".(5)

In addition to providing a wide range of insurance benefits, The American Express Platinum Charge Card has an assistance service on hand to provide help in case of emergencies. This includes connecting Cardmembers with a trusted English-speaking doctor or lawyer, or putting them in touch with the local embassy or consulate for help. This service gives the traveller and importantly, the parents back home, additional assurance and peace of mind that there's professional help at the end of the phone - 24/7 - anywhere in the world.

Core features and benefits offered to American Express Platinum Charge Card Supplementary Cardmembers include:

  • Most Supplementary Cards are offered at no additional charge - meaning parents can have a Card issued for their son or daughter (over the age of 18), which can be used all over the world

  • Parents are able to monitor the Supplementary Cardholder's spending overseas, while earning valuable reward points on the spending

  • Comprehensive worldwide travel insurance, which covers Cardmember, plus partner, children, up to five Supplementary Cardmembers and their families

  • Medical Assistance and Expenses - covering a range of activities, including usual holiday sports, snowboarding and skiing

  • Supplementary Cardholders have access to most of the benefits of the primary account holder - such as the 'Platinum Service' which offers anything from advice on where to go, help change travel plans at a moment's notice, or provide emergency assistance

  • Complimentary access to over 700 airport VIP lounges around the world.

  • Trip Cancellation - Abandonment or postponement of trip can be refunded by up to £7,500 per person for non-refundable items

  • Lost, Stolen or Damaged Baggage - Up to £2,000 per person, with a single article limit up to £500

  • Travel Inconvenience - Cover up to £300 per person for delayed and overbooked flights, missed departures and baggage delays after four hours

For more information on the American Express Platinum Charge Card and Supplementary Cards visit www.americanexpress.com/uk/platinum-card today.

Notes to editors:

Please reference the American Express Platinum Card research when using the statistics

(1) Omnibus research was conducted by One Poll, 2000 teenagers and young adults aged between 16-24 year-olds were surveyed online between 7 September and 14 September 2011. In the survey, the term Gap Year was defined as "a period of time/'time out' to travel, do volunteer work overseas or have a working holiday".

(2) Office of National Statistics UK population figures - 7,467,000 16-24 year-olds in the UK. Based on the research: 33.65 per cent of respondents plan to go on a Gap Year in the next 12 months. 33.65 per cent of 7,467,000 = 2,512,645 (rounded to 2.5 million).

(3) UCAS reported 2011 UK university application figures of 694,535 as at 22 September 2011 http://www.ucas.com/about_us/media_enquiries/media_releases/2011/app_stats11/appsta220911.

(4) The survey showed that the top perceived dangers of Gap Years are: Running out of money (23 per cent); Being a victim of crime (21 per cent); Lack of preparation e.g. no accommodation, unable to understand language (18 per cent); Losing essentials e.g. passport, money, airline tickets, phone (15 per cent); Getting lost overseas (12 per cent).

(5) American Express Services Europe Limited ("AESEL") makes various benefits available to Cardmembers which derive from contracts which AESEL has made with third parties. AESEL is free to amend, extend or terminate these benefits at its sole discretion. These benefits do not form part of AESEL's contract with you but AESEL will provide reasonable notice, in any event no less than 30 days, in advance of any changes to the available benefits which may be to your detriment. One of the benefits currently available is the benefit of contracts of insurance held by AESEL with certain insurers. You will lose these benefits if you cease to be a Cardmember. Terms, conditions and exclusions apply. Details can be found on the American Express website.

AESEL registered Office: Belgrave House, 76 Buckingham Palace Road, London, SW1W 9AX, United Kingdom. Registered in England and Wales with Number 1833139, is authorised by the Financial Services Authority under the Payment Services Regulations 2009 (reference number 415532) for the provision of payment services. For insurance mediation activities only, AESEL is an Appointed Representative of American Express Insurance Services Europe Limited (reference number 311684) who is authorised and regulated by the Financial Services Authority. Details can be found on the FSA Register."

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