Frosty Gift Giving Forecast: Rising Costs and Inflation Dampen Holiday Spending Enthusiasm, New Survey Reveals

(KNSI) — Holiday spending is off to a good start online, but a new survey shows a frosty gift giving forecast.

Cassandra Happe, with the personal finance website WalletHub, says the nationwide survey results showed that more people are dialing back on how much they spend due to rising costs. The study showed that 28% of people would spend less than last year on holiday shopping, [and] “more than one in three Americans are foregoing gifts this year due to inflation. With inflation and the way that rates have just skyrocketed, it has really impacted how much people are able to give.”

According to the Bureau of Labor Statistics, the Consumer Price Index, which measures the average change over time in the prices paid by consumers for goods and services, shows all items, less food and energy, are up 5.5% from last year. The cost of shelter is up an average of 6.75%, and transportation services costs are up 9.7%. The current fixed rate for a 30 year mortgage is 7.73%, with credit card interest rates hovering around 21%.

So, Happe adds, “Not only are people struggling with having the money to be able to give at [the level] which they would like to give this year, they’re still grappling with their spending from last year if they haven’t paid that off already.”

Roughly 25% of Americans still have holiday debt from last year, and almost half say they won’t pay for their holiday purchases in full by the due date.

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