Happy Holidays?
The consumer credit market received early good tidings last week with the National Retail Federation’s holiday spending outlook. Based on a survey of more than 8,000 consumers, it found that the more than 90 percent of American adults planning to celebrate the upcoming winter holidays expect to spend an average $875 dollars in the process. This is a small increase compared to 2022 but largely in line with survey results over the last several years.
Of course, it wouldn’t be the holiday season without a bit of Scrooge mixed in. With the spending on gift-giving, decorations, and food, comes financial stress for many households. Another recent report puts some context to this perennial holiday phenomenon.
- Nearly half of those surveyed cite events and celebrations as the top financial stressor in the fourth quarter of the year.
- More than one-third say December is the peak month for seasonal financial distress.
This is on top of the finding that 60 percent of consumers live paycheck-to-paycheck.
The report cites widespread use of consumer credit as a strategy to smooth seasonal financial fluctuations. Indeed, 36 percent of those surveyed have used credit products to manage seasonal financial distress, with nearly 21 percent reporting credit use is their most frequently employed financial management strategy.
October 23rd, 2023
