A July gauge on Christmas shopping showed an increasing number of consumers plan to spend more during the holiday season, according to Optimove’s 2023 holiday survey.
Despite inflation and rising costs, 35% of consumers planned to spend more on holiday gifts this year. That’s a 105% increase from the 17% that said the same in last year’s survey. Additionally, 65% said they were more confident about their holiday shopping budgets than the year before.
Consumers also plan to get a head start on shopping with 50% saying they would start by the end of October. Price is the top reason influencing consumer decisions, and many shoppers said they planned to get holiday shopping done early to maximize bargains, according to the survey.
“The survey reveals increased consumer confidence in personal finances and the overall economy for the upcoming holiday season,” Optimove said. “This presents opportunities for retailers to employ strategies such as upselling and cross-selling.”
If you’re trying to free up your budget for Christmas purchases, consider using a personal loan to pay down high-interest credit card debt. Visit Credible to compare interest rates on a variety of financial products without impacting your credit score.
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Inflation easing but likely to linger out of Fed target rate
Inflation in the month of June hit 3% – a two-year low, signaling that it is easing. However, Fannie Mae Chief Economist Doug Duncan previously forecasted that inflation will linger at 3% for the rest of the year, increasing the likelihood that the Federal Reserve will respond with further rate increases this year.
For consumers, high prices can impact how much they spend on everyday items. High-interest rates can impact what they pay to use their credit cards or on borrowing costs for purchasing big-ticket items like auto loans and mortgages.
“Consumers should continue to be diligent to the extent they are able when using cards whether planning any late summer travel, doing back-to-school shopping, or simply paying for household expenses,” Michele Raneri, TransUnion vice president and head of U.S. research and consulting, said in a statement. “As always, consumers should consider their ability to make monthly payments.”
If you’re planning to borrow money to finance holiday shopping, you may want to consider a 0% APR credit card. You can visit Credible to compare multiple rates for free, all in one place.
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Back-to-school shopping budgets take a hit
By contrast, consumers gearing up for back-to-school shopping said they are budgeting less this year despite higher prices, a Deloitte survey.
Overall, parents said they would trim spending budgets on back-to-school items by 10%, spending an average of $597 per student, according to the survey. At the same time, the price of school supplies surged by roughly 24% in the last two years.
Inflation and uneasiness about the U.S. economy is the number one reason why parents said they planned to spend less. Thirty-one percent said their households are in a worse financial situation than last year, and 51% expect the economy to weaken in the next six months.
If you are struggling to pay off debt, you could consider using a personal loan to consolidate your payments at a lower interest rate, saving you money each month. Visit Credible to find your personalized interest rate without affecting your credit score.
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