Christmas is always an expensive time of year, with many consumers feeling pressured to buy that perfect gift no matter the cost. Now, with the recession officially over, a poll by MoneySupermarket.com has found that the average consumer has spent a whopping £445 on presents, food and drink in order to make the festive season special this year.
It is no secret that, due to technological progressions and a relatively high inflation rate, presents are becoming more and more expensive. This year, items appearing on most requested lists will include smartphones, tablet computers and 3D televisions, all of which carry a hefty price tag. Yet with disposable income still stagnating and energy prices rising, the question is whether we are spending more than we can afford in an attempt to please our friends and relations.
Furthermore, children this morning will have opened an average £132 worth of gifts thanks to a plethora of technological must-haves topping lists to Santa all over the country. Yet this buying bonanza will have taken its toll on parents, as 47 per cent admitted to feeling pressurised into spending more than they can afford in the run up to the big day.
67 per cent of parents participating in the survey claimed that caution would be the word of the day this Christmas, with the current financial situation and energy price hikes in January hanging over their heads. Yet, despite the caution being exercised by careful consumers, 19 per cent expect that the cost of Christmas will push them still further into debt.
Financial expert for MoneySupermarket.com, Clare Francis, says; “Christmas shopping is a significant area of expenditure for parents in particular.
“A recent survey of MoneySupermarket visitors found only 37 per cent will fund Christmas using disposable income this year, with an encouraging 34 per cent planning to use their savings.”
Last year, the average consumer was set back by £437 during the Christmas season, making this year’s £445 an increase of 1.8 per cent. While this rise is only to be expected due to the end of the recession, there are concerns that this may set the average family up for a fall when gas prices rise in January.
The group most likely to overspend is the 35 to 54 year olds, with an average Christmas cash injection of £491 per person. In contrast, the 18 to 34 year olds will spend £415 on average, with the over 55s taking the middle ground at an average of £423 spent per person.
Richard Lim, economist at the British Retail Consortium, says; “Households have been through a challenging year and two thirds are very cautious about how much they spend due to the current financial climate.
“Consumer confidence remains at historically low levels and people are still worried about the economy, jobs and their personal finances while coping with a sustained period of falling real incomes.
“Despite these ongoing challenges, it’s positive to hear that people are intending to put some of their worries to one side and enjoy the festive season – Christmas is the most important time of year for the retail sector and a £22 billion boost will be a significant help in these difficult times.”
This Christmas, it’s important to remember that it is not about the cost of the presents or buying luxury fare for the Christmas table, but about spending time with friends and family. However, with the average consumer deciding to loosen the purse strings and enjoy the festive season this year, it seems that this Christmas will be a very merry one for those in the retail sector!
Do you tend to overspend at Christmas in a bid to find the perfect present for your friends and relatives, or do you manage to keep a cool head even when doing the last minute Christmas shop? Should the focus of Christmas be less commercialised and more about spending time with loved ones, or is the tree and presents just as important a part of the festive period as sitting down for Christmas Dinner together?
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