Consumers Remain Cautious About Spending During Holidays

Over recent years there has not been a whole lot to be merry about around the holiday season for most consumers.  The price of gas hovered around $5/gallon and the rising cost of utilities had almost everyone on the ropes.  Many were hesitant to use their credit cards. Consumer pessimism regarding the holiday shopping season seemed to rise with the tide and has carried the day recently.  Consumers have been decidedly tight fisted with their money.  Retailers suffered and the recession has deepened.  This upcoming holiday season, however, appears to be looking a little brighter.  Learning from the over indulgence of the past, however, most will use their credit cards carefully and limit their holiday spending and the subsequent holiday ”debt hangovers”.

Although the economic situation has turned somewhat positive, the recession still has many in its grasp.  The economic recovery seems to be taking hold but it will take a while for everyone to feel the full benefit.  One of the primary positive outcomes from the economic downturn is that consumers have become decidedly thriftier.  Consumers are taking a more savvy approach to spending their hard earned income.  People are beginning to prepare shopping lists and are now working much harder to stick to them.  Many consumers have more frequently been choosing generic versions of products instead of the more expensive equivalent brand names.  Looking forward, consumers overall still plan to spend less.  Consumers will always be attracted to specials, deals and discounts, doing their shopping at retailers that offer the most bang for their buck.  Consumers are looking forward to the holiday season but are better prepared to properly budget than ever before.  While consumers in general are still utilizing their credit cards, they are much more cautious about their spending overall these days and will continue to be cautious during the upcoming holiday season. 

While consumers are decidedly more optimistic about the upcoming holiday season, they are still very worried about the overall economy and their financial futures.  Many consumers have grown tired of the seemingly over-the-top commercialism that has seemingly taken over the holiday season.  In response to the recent economic hardship, many consumers have gone back to the age-old tradition of giving and sharing by creating their own handmade presents.  Undoubtedly, gifts from the heart will shine brighter than anything that can be bought at a store.  Credit cards however are still alive and well and consumers will use them during this holiday season; the difference nowadays is that they’re more likely to use them like one of the 3 wise men.  The days of maxing out credit cards over the holidays and spending the better part of the next year paying for them seem to be gone.  Being optimistic does not mean consumers have to be irresponsible.  Consumers have adapted to the times.

No doubt consumers have higher expectations for this holiday season.  Although this will lead to higher consumer confidence it does not mean that consumers will be spending their money so carelessly as they’ve done in the past.  Increasingly, consumers have learned hard lessons from the latest recession and have come to realize that the holiday season is about family, friends and the magical moments that are shared amongst them all.  Retailers should have tempered expectations this holiday season.  Consumers will not eliminate credit card spending entirely, but they will most definitely be approaching it more responsibly. 

Retail sales should fair better than the 2008 holiday debacle because consumer sentiment overall is much improved compared to this time last year.  Nevertheless, it still may be one of the thriftiest holiday spending seasons in recent memory.

Related Posts:

• Consumer Credit Spending Gaining Confidence - Consumer attitudes on spending has a huge effect on the economy.  Consumers willing to use their plastic, spend money on discretionary items...
• Keeping Holiday Spending Under Control - If you are like the average American, you’ll spend somewhere around $900 this holiday season on gifts. If you are like 1/3...
• Card Use Remains Strong at Holiday Time - Preparation for the holiday season comes well before the first holiday song is played on the radio or the first television commercial...
• Scammers, Skimmers and Fraud Threats Remain for Consumers - Just ask Florin Necula, he would know!  While being booked in a Secret Service office he grabbed a flash drive and swallowed...

This entry was posted on Wednesday, October 14th, 2009 at 8:53 am and is filed under Credit Card News, Debt & Consolidation. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.