We live in Chicago and have a 4-year-old we enjoy traveling with a great deal. Prior to Matthew (the 4 YO), we usually booked package deals from the airlines or Apple Vacations (large wholesaler.) They were all pretty good.

Last year we had free miles, so we compared the packages carefully against airfares to see if using "free" mileage tickets was worth it for a trip to the Mexican Pacific coast. There was a big enough difference to prompt us to use the "free" tickets. We wound up at the Westin Puerto Vallarta and it was terrific! We are again off to Mexico, this time to Cozumel. Upon comparison, lo and behold - buying  individual air tickets and booking the hotel ourselves, as individuals, was cheaper than the packages! How could this be?

We think the reason is simple. There is a hotel component imbedded in every package, even when the package includes a toddler. However, families such as ourselves invariably stay in one room, thereby saving the imbedded cost of the hotel for the child. It's not small. We saved around $400 for a five-night deal and that's not unusual, as we looked at a lot of stuff on the web. We also stay at pretty good places like Westin, etc. so it's not a "cheap hotel" type deal, either.

[That we could save money by booking good hotels ourselves] was a revelation to us, and perhaps could be to others traveling with small children, who stay free in a hotel room with parents.