Ready or not, the countdown to the holidays has begun. Even if you’re not hopping on a plane, there are gifts to buy, parties to attend, fruitcake to avoid and days off to plan. It’s more than understandable that you’d want to skip Christmas altogether, but given the strong state of the economy, it’s a little surprising how few of us are planning to splurge this year, according to a new online poll of 1,093 adults by CreditCards.com.
Just over half of Americans — 53% — plan to spend $50 or more on their most expensive gift this holiday season, CreditCards.com found. That percentage includes the 27% who said they’d spend $100 or more. On the other hand, just one in eight, or about 12% of adults said they don’t plan to buy any gifts at all.
There was also a notable gender divide on holiday spending, with men saying they are most likely to spend the most on their significant other and women planning to give their most expensive gift to their kids. Women also appear to be thriftier: 40% said they will spend less than $50 on their most expensive gift versus just 29% of men.
Are consumers spending less on gifts?
It’s the first time the company has conducted a survey of this kind, Matt Schulz, the personal finance site’s senior industry analyst said, meaning that they’re not quite sure how the numbers would stack up compared to last year.
But the National Retail Federation’s annual consumer survey also found something similar. While people’s overall spending for the 2017 holidays will be up by 3%, from $936 to $967, overall spending on gifts is expected to decline from $621 in 2016 to $608 in 2017.
Though holiday spending overall is going to go up, the NRF found, people said they planned to spend slightly more than $478 on gifts for family, down from almost $486 last year. People also said they planned to spend less on gifts for colleagues and friends.
“We were surprised,” Schulz said. “By all accounts, people are spending, the job market is improving and people seem to have their finances fairly under control. So it was interesting to see that they’re not likely to splurge.”
So what gives? There are a couple likely culprits for the survey’s findings. Schulz pointed out that though workers have found it easier to get jobs, the most recent jobs data suggests that they still aren’t getting raises. Wages were stagnant in the latest jobs report for October 2017.
The holidays are also still a ways away, and some people might be overestimating their ability to resists impulse buys, Schulz said. “There’s definitely a chance that people are underestimating what they’ll spend. ... We’ve all been in a store and seen an item that strikes us as the perfect thing to get somebody, and a lot of times in those cases that item is a little more expensive than we intended to spend.”
How to save on holiday gifts
The most important thing to remember, Schulz said, is to use a shopping list when you buy. Some of the big box retailers, for example Target, use retail techniques from higher-end stores to make items seem more like specialty items. And just because a company says you’re getting a good deal in a promotional email or advertisement doesn’t even mean the item is actually marked down at all.
Having a shopping list will also protect you from a number of retail’s favorite tricks: from slow-tempo music (which tends to prompt shoppers who make unplanned purchases to spend about $33 more than when they buy in silence) to confusing store layouts that force you to walk down aisle after aisle of tempting presents.
Another way to save is by choosing more thoughtful gifts that cost less. Like to homebrew? Give your friends a few bottles for a totally unique gift. You could also invite friends over for dinner for a homemade meal rather than taking them out. And if you must buy a gift at a store, be sure to keep an eye out for Black Friday sales that can slash your costs.
One last trick is to sign up for a credit card with a signup bonus or cash-back offer to offset your costs. Most cash-back cards for people with good credit will usually offer in the ballpark of $150 cash back if you spend $500 during the first few months, Schulz said.
For more on the best rewards, check out Mic’s guide to the best rewards cards, plus how much you’ll need to spend on each card to break even. And remember that just because you have a new credit card, that doesn’t mean you should spend like crazy. In fact, now might be a good time to get cracking on your holiday budget.
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