The Europe Trick

Even with the dollar on the losing side of the exchange rate, the European Travel Commission expects the number of U.S. tourists this year to match, or even break, the record 13 million who visited in 2000. But with prices on the rise, more travelers are getting creative about how to go in style — without going broke. Don't get us wrong: The days of slipping into the Continent's best hotels for a couple hundred dollars or less are long gone. And be prepared for eye-popping prices on everything from steak frites to opera seats. (Try $275 to catch La Traviata in Milan.) But with Europe offering some of the world's most desirable destinations, there's the obvious question: Why miss out?

Today's savvy travelers are working all the angles, from basic frequent-flier miles to the less used but equally valuable hotel loyalty clubs. Thanks to some new carriers, overseas business-class fares have become a near bargain on certain routes. And tour packages, which lump together everything from airfare to hotels and meals, are shedding their low-budget image and offering some decidedly upscale options. That's how the Andreggs scored their deluxe trip.

When it comes to Europe, all but the über-wealthy need to do a little cost-cutting these days. The exchange rate has gone from bad to worse: The euro now trumps the greenback by nearly 50%, while the pound is almost twice the value of the dollar. Transatlantic airfares have risen in most markets, and the average daily hotel rate in Europe in March was 31% higher than the year-earlier month, compared with a 6% increase in North America. But you don't need to start calling hostels. Below, you'll find strategies for planning a first-class trip — without breaking the budget.

Of course, since all-business-class carriers fly out of limited markets (New York; Washington, D.C.; and soon Los Angeles and Las Vegas), many travelers have to use other strategies, like frequent-flier rewards. Your best bet? Rather than upgrade your miles, redeem them for a premium seat, advises Joe Brancatelli, publisher of travel web site JoeSentMe.com, since more airlines are charging additional fees or limiting eligible types of fares. If you don't need all the perks of business class, consider "economy plus," seats with up to 20% more room than those in regular coach. Virgin Atlantic has as many as 58 premium-economy seats per flight and will soon expand to 65.

As the Harshmans learned, even the most upscale properties have hopped on the loyalty-program bandwagon. When you think Starwood, the W or Sheraton springs to mind, but the company's reward program also covers the tony Le Méridien and the Luxury Collection, which includes properties like the Alfonso XIII and the Grand Hotel in Florence. Marriott Rewards members can cash in points at the Ritz-Carlton or Orient-Express Hotels, while the Priority Club rewards you earn at the Holiday Inn (rates as low as $68) can be used for free nights at InterContinental resorts (ranging above $1,000 a night).

If you're not using points, be strategic. Business hotels are generally a good bet in the summer, when most European businesspeople are on holiday. They also tend to be cheaper on weekends, while resorts offer deals midweek. And even with demand soaring, many hotels are still willing to make a deal if it means extending your stay. Leading Hotels of the World, a group of more than 430 luxury hotels, offers a One More Night program, where travelers who book a certain number of nights get a freebie thrown in. At the Hotel Majestic in Rome, this recently translated into a free fourth night, a savings of more than $900.

The best way to save? Avoid the big two: Tuscany and Provence. Italy is pricey overall, says Dan Legault, president of villa company HomesAway (a different outfit than HomeAway), though bargain-seeking Francophiles do have some options, like the less well-traveled Normandy and Burgundy regions. Still, vacationers striking out into new areas should be cautious, since villas in these regions usually haven't been as thoroughly vetted as those in the traditional tourist hot spots. When HomesAway added new properties in Croatia, for example, Legault started with 120 potential villas, but after visiting them, discovered that only five were really up to snuff.

And have we mentioned the bargain bin of packaged travel? Whether you're buying basic airline-and-hotel bundles or full-fledged guided tours, expect to save 15% to 20% over what you'd pay á la carte. The deals get even better when costs spike, since package rates are usually published at least a year in advance. The upshot? This year's travelers pay last year's prices — and dodge runaway exchange rates by paying in dollars. Companies frequently offer their best deals on bigger, more inclusive packages. Luxury operator Abercrombie & Kent recently offered a $500 discount for those who booked a business-class airfare along with their two-week tour of Turkey.

But even with Crystal Cruises offering cuisine from sushi mecca Nobu and Tauck World Discovery tours boasting overnights at posh hotels like the InterContinental Paris Le Grand, perhaps the biggest challenge for cruises and tours is not proving they're a good deal, but convincing vacationers that they are, in fact, luxury travel. "I know, I know: If It's Tuesday, This Must Be Belgium," sighs Bob Whitley, president of the U.S. Tour Operators Association. "That movie was made 38 years ago!"