WASHINGTON -- With the official start of the holiday shopping season just days away, a new survey conducted by CUNA found that 41% of consumers intend to spend less than last year on holiday items, with just 8% percent planning to spend more.
The annual CUNA survey, conducted with the Consumer Federation of America, found only about 1 in 5 consumers said their financial situation is better this year than last year.
In the national survey of 1,011 representative adult Americans conducted November 10-13, a significantly higher percentage (37%) reported that their financial condition was worse this year than a year ago compared to the 30% who responded that way to the same question in last year's survey. On the other hand, this year only 19% reported that their condition was better compared to a year ago, while 23% responded that way last year.
These findings help explain why 41% said they were planning to spend less this year than last year compared to only 8% who said they planned to spend more. Those two findings are almost identical to last year's results, when the same percentage (41%) indicated they planned to spend less, and a slightly greater 10% said they would spend more.
These results are an improvement from the 55% of respondents who said they intended to spend less in 2008's survey, at the depth of the Great Recession. But from 2000 to 2007, the percentage who indicated they planned to spend less never exceeded 35% and often was 30% or lower. (Since consumers always spend more than they intend, the year-to-year comparisons, not the absolute levels, are what is meaningful for predicting spending.)
The survey found that high-Income households are reporting much greater financial improvement than lower-income households. Comparing responses from different demographic groups reveals interesting, and somewhat troubling, differences. Most significantly, high-income households are much more likely to report improvement in their financial situation than are low- and moderate- income households over the past year. Of those households with at least $100,000 in annual incomes, 35% said their financial situation was better and only 18% said it was worse.
By comparison, of those households with annual incomes below $25,000, 13% indicated improvement and 50% worsening in the past year. And of those households with annual incomes of $25,000-$50,000, 24% indicated improvement and 39% worsening. (Slightly more than half of all US households have incomes below $50,000.)
Not surprisingly, then, fewer high-income households than lower-income ones reported concern about meeting monthly debt payments. Despite the fact that far more households with at least $100,000 in income have mortgage loans and credit cards than do lower-income households, only 23% are concerned about meeting monthly debt payments compared to 59% of households with incomes under $25,000 and 54% of households with incomes between $25,000 and $50,000.
