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How to Save Money on Airfare

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First, the bad news. After more than a year of falling ticket prices, the cost of flying is now rising. According to statistics from the U.S. Department of Transportation, the average domestic airfare jumped 4.7 percent in the first quarter of 2010 compared with the same period last year.

Now the good news. You can do something about it.

First, understand that the rules around when and where to buy tickets are constantly in flux—airfare offers change up to three times each day during the week. Airlines aren’t just changing the fares but also the number of seats that are available at the lowest fare. There might be one seat today at the lowest price and a dozen tomorrow morning. Or vice versa. You need to search hard, find the fare, and lock it down immediately.

In other words, timing is everything when it comes to saving money on airfare. That’s true for when you buy, but also for when you decide to travel. To find the lowest fare, flexibility is key. If you have wiggle room built into your schedule, you can sometimes save hundreds by adjusting your travel dates, often by just one or two days. (And those who are very flexible might try an auction site like Hotwire or Priceline.)

Unfortunately, this tactic doesn’t work very well during the busy holiday season when seats are at a premium. In fact, it’s difficult to find any low prices when the holiday season approaches. Airlines traditionally raise their fares for travel during peak holiday periods and for last-minute travel, and they start planning early. Don’t expect to use your miles to save money, either. During the holiday season, there’s little—if any—chance of getting a seat using a “restricted mile award.” You’ll have to dig deep into your account for one of those “anytime mileage awards.”

Our most important tip? Take charge and shop around. Don’t assume that all online travel agencies have the same fares, or that the airline’s own website has the highest fares. And don’t overlook air/hotel packages; the total package price, including the hotel, can be less than the airfare alone. —Everett Potter

With reporting by Jennifer Coogan, Jennifer Flowers, and Nick Teddy

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