Holiday $eason on a budget
Polls show trend to smaller gifts
Maybe this isn’t the year to get that pricey new car or take that expensive cruise. Maybe it is time for a lot less stress by spending a lot less on the holidays.
That’s what several polls are finding after asking people about their holiday shopping plans.
Smaller gifts will be the theme in many homes this Christmas, with more adults looking closely at price tags and worrying about how to pay for things.
Some people are even saying “Bah, humbug!” and wishing there were no Christmas, according to the studies. Big-ticket items, they said, are less likely to make it under the tree this season.
“Just 53 percent of US adults will buy a Christmas gift that costs at least $50 this holiday,” according to a new CreditCards.com report that polled 1,100 US adults. The survey also found that it is not just those with modest incomes who are thinking twice about whipping out credit cards.
“Well over 4 in 10 (44 percent) of the richest respondents (those with annual household incomes of $80,000+) plan to keep their most expensive holiday gift under $100,” according to the survey.
Why the Christmas sticker shock?
Matt Schulz, CreditCards.com’s senior analyst, said he was surprised by the poll results given the stock market’s recent strengths and low unemployment rates. The spending caution, he added, is probably because many workers are pessimistic about their prospects.
“I think part of what is going on is most Americans don’t see a raise anytime in their future. And when you don’t think you are going to make more money in the next year, it will make you less likely to spend big on the holiday,” he said.
Another problem, Schulz added, is “with the Great Reces- their sion still relatively fresh in peoples’ minds, most Americans seem to be planning a frugal holiday — think sweaters, not cellphones.”
Part of what is spooking gift givers is how they will pay bills due in January.
Some will pay for the holidays with money they don’t have yet. CreditKarma.com, recently found that 54 percent of those surveyed said they “already planned to spend next year’s tax refund to pay for holiday shopping.” That’s even though they won’t have their tax refunds for months.
And then there are those whose pending holiday bills are turning them into Scrooges.
Mr. Cooper, which is a nonbank mortgage servicer in Dallas, said a third of 1,155 households surveyed said they “at least somewhat wished they could skip the holiday season rather than spend money on gifts.”
Since US consumer debt is growing by a half-trillion dollars each year, the stress is taking its toll.
“Our data confirm that the debt crisis is an ongoing issue,” said Jay Bray, chairman and CEO of Nationstar Mortgage Holdings, the holding company for the Mr. Cooper brand, while noting that home equity is “at its highest levels” since before the mortgage crash of 2008.