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Nearly 7 in 10 Shoppers Likely to Overspend This Holiday Season, Survey Finds

Over a third of consumers said they were likely to splurge in multiple categories, as household debt sits at record highs.

Robert Rodriguez/CNET

Most consumers expect to overspend this holiday season, a sentiment that raises financial concerns as millions of Americans grapple with higher prices, larger credit card balances and the return of student loan payments.

In an exclusive CNET Money survey, 69% of respondents said they would likely overspend on purchases at some point this holiday season. Nearly a third of shoppers said their overspending would occur in December, whereas 27% said they would likely overspend during fall holiday shopping events. Several major retailers, including Amazon, Walmart and Best Buy, now promote shopping bonanzas in October to try and capitalize on a longer gift-buying season.

“Food and beverage” led the way in overspend categories (35%), followed closely by “fashion and accessories” (34%) and “electronics and technology” (33%). But despite the potential peril, some consumers will treat themselves anyway, as 23% claimed they will buy something they really want or need if they see it, regardless of going over budget. 

The survey was conducted between Sept. 22-26, 2023, and participants could select multiple answers for category-specific questions.

The results arrive at a financially precarious time for many Americans. Average household debt surpassed six figures last year, according to Experian, and overall combined credit card debt in the US recently passed $1 trillion, according to the Federal Reserve Bank of New York.

Consumers still spending despite rising personal debt

COVID-19 quarantine protocols created economic disruption but also led to record improvement in credit card debt balances, as consumers paid down a whopping $120 billion in 2020. Stimulus payments contributed to this paydown, according to an analysis from the Federal Reserve.

The stimulus payments waned in the spring of 2021, and as economic activity picked back up, it led to a sharp increase in inflation and overall prices on many goods. Consumers leaned more heavily into credit cards and other sources of financing to cope. As the Fed continued to hike rates, credit card APRs also spiked, creating a double-whammy: Consumers have more credit card debt than this time a year ago, and higher interest rates now make that debt more expensive to maintain.

Nearly one in five Americans (19%) have more credit card debt going into the holiday season than they did last year, and 23% have “about the same” compared with last year. Of the shoppers who plan to leverage credit cards, 37% said they’ll pay them off in full to avoid additional interest, whereas 21% said they would need multiple billing cycles to pay down their debt.

“A strong job market with low unemployment empowers consumers to spend more,” said Eric Dunn, CEO of Quicken, a personal finance software company. “Younger consumers who hadn’t built up an asset base and maybe had lower incomes to begin with ran up credit card debt as a result.” In a survey conducted by Quicken this summer, two in five Americans reported being more dependent on their credit cards than ever before, and 35% expected to max out at least one credit card before the end of the year.

“I think it’s a hangover from the economic and employment boom that happened unexpectedly during COVID,” Dunn said.

Longer holiday shopping periods mean more opportunities to overspend

Black Friday has long signified the start of the holiday shopping season. But in recent years, the ubiquity of e-commerce has made it easier to get what you want, whenever you want, without even having to leave your home. A separate survey from Bankrate found that half of consumers would already be holiday shopping by Halloween, and that 54% of them feel “financially burdened.” 

In CNET’s survey, one in five respondents said it was likely they will have already overspent by Nov. 1. 

Mainstream personal finance advice for this often-expensive time of year is to set a budget, but most Americans haven’t gotten around to it: Just 24% of respondents said they had or planned to set a holiday budget. Creating a budget can help you get specific and put boundaries around dollar amounts, said Stacey Black, lead financial educator at BECU, a not-for-profit credit union.

“When I went through a divorce years ago, it was a tough year for me financially. So I talked to my family about it,” Black said. “A lot of people are struggling right now. If we have those open and honest conversations, I think that will help.” Black also teaches classes to parents on how to have age-appropriate conversations with kids about financial topics.

“It’s a great learning experience to say [to your kids] ‘Hey, we struggle, we’re going to work as a family to get through this,’” she said.

Although the holiday shopping season is now more spread out, there are opportunities to save money if you know where to look. Browsing extensions like CNET Shopping help you compare prices on different websites to ensure you’re getting the best price for a product. For those who do plan to leverage a credit card, applying for a new card that has cash back rewards could stretch your budget a little further. Be diligent about paying off your balance in full, though, as today’s record-high interest APRs will quickly cancel out a cash-back incentive.

If the imminent holiday spending tsunami has you feeling stressed, take a step back and create a plan. The holiday season is a time for gathering as well as gifting and establishing clear goals now will help you stay the course when spending temptations arise.

All figures, unless otherwise stated, are from YouGov.  Total sample size was 2,408 US adults, of whom 2,070 are likely to spend money on purchases this holiday season. Fieldwork was undertaken between Sept. 22-26, 2023. The survey was carried out online. The figures have been weighted and are representative of all US adults (aged 18+).

A classically trained French hornist by education, Nick Wolny is a senior editor and journalist at CNET, where he oversees coverage related to consumer spending, consumer tech and personal finance. He is also the finance columnist for Out magazine and a frequent television correspondent. Prior to CNET, Nick owned a marketing consultancy for six years, a company he retrofitted into a side hustle upon pivoting his career toward journalism. He has previously written thought leadership columns for Fast Company, Insider, Entrepreneur Magazine and FORTUNE, and is based in Los Angeles.