'Funflation' is making summer joys more expensive—but who cares?

Having fun this summer comes with a hefty price tag—thanks to what analysts call "funflation."

While many Americans are keen to compensate for lost time after Covid and enjoy live experiences, the surging cost of tickets is putting a big dent in their pockets.

May's inflation figures from the Bureau of Labor Statistics revealed that the cost of admission to sporting events is up 21.7% in a year—the largest jump across all of the items it tracks.

Although ticket prices for movies, theaters, and concerts edged up by a more modest 3%, gigs for major artists still cost a pretty penny… as many Swifties would tell you.

Reports suggested that average resale prices for her U.S. shows hit $3,801—but over in Europe, tickets on secondary markets cost up to 80% less.

CNBC analysis suggests that it now costs 16.9% more to go to the theater or a live music show than it did three years ago, and sharp price rises after the pandemic are here to stay.

A recent and rather worrying poll by Bankrate also found that 38% of Americans are prepared to go into debt in order to have a little fun.

While 27% are willing to whack traveling costs on their credit card, 14% say they'll head in the red for a meal out, and 13% would borrow for sports or concert tickets.

"Maybe it’s still post-pandemic celebrations. Maybe it’s relief over potentially avoiding a recession. Or maybe it’s revenge spending due to financial stress," Bankrate says.

Its senior industry analyst Ted Rossman pointed to all this as the sign of "a 'you only live once' mentality that intensified during the pandemic."

Changing priorities

There's a growing body of studies that illustrates how spending habits are shifting more widely—irrespective of whether there's "funflation" or not.

An Intuit study found that 73% of Gen Z, those born between 1997 and 2013, "would rather have a better quality of life than extra money in the bank.

Meanwhile, Bread Financial found that younger consumers are "going further and spending more than other generations for live events"—driven by a fear of missing out.

Almost two-fifths of Gen Z and millennials have spent up to $5,000 to attend live events too, dipping into their savings or snapping up an extra job to make ends meet.

"They don't want to miss out and will do what it takes to see their favorite artist, sports team, or other live event in person," AAA Travel's senior vice president Paula Twidale said at the time.

It's been a blockbuster time for globetrotting tours, with Harry Styles and Beyoncé also playing to packed-out crowds.

For now, it looks like Americans are willing to stomach higher ticket costs. But with exploding consumer debt, it's a question of when, not if, the American consumer will hit the brakes.

Meanwhile, the Federal Reserve remains locked in a battle to bring inflation back to 2%.