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By Maggie Tomasek
Gifts. Decorations. Travel. There are so many fun things to spend money on this time of year. But just how much are Americans spending this holiday season? Let’s take a look.
After seeing overall holiday sales increase 4% in 2019, the National Retail Federation (NRF) expects Americans to spend 5% less this 2020 holiday season, bringing overall holiday spending to under $30billion.
Despite the pandemic’s economic toll, consumers are still spending above the five-year average for gift spending, prioritizing friends and family over spending on themselves.
Online shopping continues to be a big choice for consumers. Of people who shop online, 44% percent say they will pick up purchases in-store during the holiday season.
(In case you’re wondering what the holiday shopping season includes, it covers all of November and December, including four major holidays: Thanksgiving, Christmas, Hanukkah and Kwanzaa.)
Why are people decreasing their holiday spending only slightly? Focusing on celebrating the holidays and giving gifts may be a way for people to take a break from the stress and unpredictability of the COVID-19 pandemic.
Retailers expect demand to be high, so shoppers are advised to shop early. However, if you’re late to the game and something is out of stock, you’re still in luck. For the 14th year in a row, the majority of consumers say they would prefer gift cards and gift certificates as a present.
PRO TIP: Start looking ahead. Take advantage of after-Christmas sales to grab birthday presents, anniversary gifts, etc. (If you don’t see a sale sign, it doesn’t mean you can’t get a deal. Here are four ways you could save money the next time you shop.)
Based on NRF’s annual consumer spending survey, Americans plan to spend an average of $997.79 this year, down 5% from last year ($1,007.24). Spending falls into three major categories:
PRO TIP: Set a holiday spending budget. Start the holiday season by creating a budget and deciding what you’re going to specifically spend on gifts, decorations, etc. Avoid splurging on something that’s not on your list just because it’s a good deal. Also, follow these tips to protect yourself from fraud this holiday season.
Gathering around the table is, of course, a tradition for many families on Thanksgiving, and that ain’t free, either. In 2020, a “classic” Thanksgiving dinner for 10 people costs about $48.91, according to the American Farm Bureau Federation’s annual informal price survey.
The cost was down for the fourth year in a row. Although this year, it is only down by 1-cent from last year’s. And that’s mainly because the holiday’s main event – the turkey – was even cheaper. A 16-pound turkey, at $20.80, was down 4% from the previous year.
At less than $5 per person for the whole meal, that’s not too shabby. However, the estimate only included the “classic” basics – turkey, bread stuffing, sweet potatoes, rolls with butter, peas, cranberries, veggie tray, pumpkin pie with whipped cream, and coffee and milk – so throwing in special delicacies or alcohol can push that cost much higher.
PRO TIP: Remember all of your grocery savings tricks. Don’t let your usual shopping savvy fly out the window just because it’s Thanksgiving or Christmas. Grab store circulars, clip coupons and stick to your shopping list to get the most out of your holiday dinner grocery budget.
So we’ve covered the gifts, the decorations and even the food. The remaining big-ticket expenses Americans incur during the holiday season are all travel-related.
In a typical year, according to the U.S. Travel Association, the top leisure activity for U.S. domestic travelers is – surprise! – visiting relatives. However, travel is predicted to be significantly down this winter season, although forecasts are not out yet. In 2019, AAA stated that a whopping 55 million Americans traveled home for Thanksgiving – the second-highest Thanksgiving travel volume since they began tracking in 2000.
Of those travelers, 49.3 million were expected to drive, 4.45 million fly, and the remaining 1.49 million will travel on cruises, buses and trains.
PRO TIP: Check out our post on how you can save money on your next road trip.
Maggie Tomasek is the special projects marketing manager at Alliant. She began her career as a sports journalist for newspapers in Utica, N.Y., Des Moines and Cincinnati before moving to Chicago in 2009. Maggie is a six-time Chicago Marathon finisher and a lifelong creative writer with a passion for comedy. Her mom instilled in her a great sense of fiscal responsibility, and her big sister told her to throw that responsibility out the window every once in a while in the name of life experience. So far, that combination of financial advice has worked out pretty well for her.
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