Yesterday we started our mini-series on Christmas shopping by looking at whether consumers are planning on visiting stores or shopping online for their Christmas gifts. Today we’ll look at how much those consumers are actually planning on spending, and whether or not most have have planned on decreasing their spending from last year or not. And the results come from a report written by the RBC, the Canadian Consumer Outlook.
The bad news is that Canadians have not planned to decrease their spending at all. Last year while Canadians only spent $1,181.80,this year they plan on boosting that to $1,192.50. And while that may seem like a big jump, it doesn’t seem as though it’s because we’re all feeling especially generous to our loved ones and opening our wallets for them. More so, it’s because we’re planning on spending more on the non-gift items such as travelling, decorations, as well as entertainment costs including food and drink.
Richa Hingorani, senior manager of financial planning support at RBC, says in the report, “Canadians continue to be conscious of their finances and intend to be smart with their expenses this holiday season.”
But that doesn’t mean that we’re being completely thrifty when it comes to purchasing gifts for those we care about. While it’s not as much as the $628.50 we spent last year, that just goes along with the fact that we’re being more careful about our spending this year; and the $608.60 that we’re planning on spending is still pretty generous.
And just how are we planning on paying for that over $600 bill? More than half – 54 per cent – are planning on spending only what they can afford today by planning on paying for their purchases with cash or debit. 25 per cent of consumers do plan on paying with plastic, and most of them even plan to pay off that credit card within the month without carrying forward an overdue balance. 6 per cent however, don’t foresee themselves being able to pay off that amount in December or January, and so they do believe they’ll need to bring that balance forward.
“One simple yet important step to keep in mind,” says Hingorani, “is that, with a little planning, it’s easy to stay on top of the holiday spending without dipping into your savings or increasing your debt. A holiday budget can go a long way to ensuring you’re not over-extending yourself – and come January, you don’t regret the holidays.”
Come back tomorrow when we look at not just how much people are spending, but how much that amount is divided up by province!