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A new survey has revealed that most Australians plan to spend less this Christmas due to the rising cost of living.
The annual Christmas Spending Survey from homeloans.com.au has reported that 64 per cent of Australians intend to spend less this Christmas, with 68 per cent of respondents citing the rising cost of living as a driving factor in their decision.
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Further, the report found that more than half of Australians (55 per cent) now purchase their Christmas gifts during sales throughout the year to reduce costs.
“There are a number of reasons why Australians have reined in their Christmas spending, with many citing growing families with more expensive wish lists, tight budgets and other financial stresses,” national marketing manager of homeloans.com.au Will Keall said.
Despite intending to spend less, the report also revealed that some Australians will still spend big, with 42 per cent of respondents buying gifts for five to 10 people and 17 per cent purchasing presents for more than 10.
Moreover, 35 per cent of Australians said that they would be spending more than $500 on Christmas gifts, including 27 per cent of those aged 18 to 35 and 39 per cent of those aged 35 and over.
“Many consumers will rely on credit cards to cover Christmas shortfalls instead of actively saving,” Mr Keall continued. “Growing families may have more trouble managing cash flow during the holidays, which could explain why half of those aged 45 to 64 will rely on plastic, compared to just 27 per cent of younger Australians.”
Generation Z were most likely to sacrifice their income in the lead-up to their Christmas spending spree.
Of the respondents aged 18 to 24, 39 per cent said that they regularly contribute part of their income to a separate savings account to fund their Christmas shopping.
The survey also revealed that younger Australians buy a similar volume of gifts to their older compatriots, and they are less inclined to use a credit card when purchasing gifts.
“It’s great to see younger Australians [taking] practical steps to make the holidays more affordable, without knocking friends or family off their nice list,” Mr Keall added.
The survey suggests that this trend is likely to continue, with younger Australians (18–24) most committed to saving in the new year (52 per cent), compared to respondents aged 45 to 64 who made the same commitment (16 per cent).
Saving money in the new year was at the top of respondents’ priority list (27 per cent), followed by debt reduction (22 per cent).
The survey also found that women were more likely than men to have a financial resolution for the new year (72 per cent to 67 per cent).
Additionally, the data revealed that a majority of Australians aged between 18 and 34 said that they complete at least half of their shopping online (58 per cent), compared to respondents over the age of 45 who do the same (39 per cent).
[Related: More than a third of borrowers ignorant of interest rate]
