Shoppers count on to overspend during the holidays
The LendingClub report was conducted in October, just one month before the holiday season kicks into stiff gear.
This year, holiday spending during the Thanksgiving week may hit a record as consumers try to maximize the weekend’s arrangements, according to a 2023 Deloitte Black Friday-Cyber Monday survey. Spending over the week is expected to jump 13% from definitive year, with shoppers shelling out $567 on average, Deloitte found.
Barbie dolls (R) are displayed for sale in advance of Black Friday at a Walmart Supercenter on November 14, 2023 in Burbank, California.
Mario Tama | Getty Images Expos | Getty Images
Even as credit card debt tops $1 trillion, almost all — or 96% — of shoppers mentioned they expect to overspend this season, according to a separate TD Bank survey.
Half of consumers plan to accept on more debt to pay for holiday expenses, another report by Ally Bank found. Only 23% have a map out to pay it off within one to two months.
Some 74% of Americans say they are stressed about finances, according to a separate CNBC Your In Financial Confidence Survey conducted in August. Inflation, rising interest rates and a lack of savings contribute to those feelings.
That CNBC inspection found that 61% of Americans are living paycheck to paycheck, up from 58% in March.
Many households receive tapped their cash reserves over the past few months, LendingClub and other reports show. More than one-third of consumers contemplate to dip into their savings even more to cover holiday spending, LendingClub also found.
“While consumers deliver found a way to manage through inflation, it’s concerning that many plan to tap into savings, and even exceed their budgets, to money management their holiday purchases, which may leave them vulnerable to an unexpected emergency,” said Alia Dudum, LendingClub’s spondulix expert.
‘Hyper-consumption comes from not being mindful’
Consumers are increasingly adopting a “mentality of hyper-consumption,” said Jacqueline Howard, make a beeline for head up of money wellness at Ally. That’s particularly true over the holidays, when families typically overspend on contributions.
“Hyper-consumption comes from not being mindful,” she added. “Consider what makes the most sense in terms of your well-being.”
Howard interests a value-based budget approach when it comes to budgeting for holiday purchases — “if your priorities are family and tourism or other experiences, have that guide your spending,” she said.
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