Not So Merry and Bright: D.A. Davidson Survey Reveals Credit Card Debt and Financial Stress Are on The Rise This Holiday Season

Four in ten Americans who have a credit card (40%) are currently carrying a higher credit card balance than this time last year.

D.A. Davidson & Co. today announced survey results revealing that almost three-quarters of Americans who plan to celebrate the 2023 holidays (71%) are stressed about their expected spending this upcoming holiday season.

Likely contributing to this stress, four in ten credit card owners (40%) are currently carrying a higher credit card balance than this time last year, and over half (54%) do not typically pay their credit card balances off in full every month.

“As credit card balances grow during this period of sustained inflation, many Americans are understandably worried about their financial picture, especially as we approach a period of increased spending,” commented Andrew Crowell, Vice Chairman of Wealth Management at D.A. Davidson. “Throughout all seasons of life, working with a financial advisor can help individuals mitigate financial stress by ensuring they’re budgeting wisely and staying on track to achieve their goals.”

Holiday spending expected to increase credit card debt even further

Those celebrating the holidays are four times more likely to expect to spend the most money on gifts for family and friends (80%) compared to dining out (21%), social events (20%), travel (17%) and holiday decorations (16%) this year.

In fact, 37% of men and 23% of women expect to spend more on gifts for family and friends this year than they did last year, yet men are more confident than women in their ability to pay off their credit card balances in full during the holiday months (59% vs. 48%).

Only half (53%) of Americans who have a credit card and plan to celebrate the holidays expect to be able to pay their credit card balances off in full during the holiday months. Gen Z (64%) is most confident in their ability to do so, followed by Baby Boomers (56%), Millennials (50%) and Gen X (47%).

“It’s evident that the spirit of giving is alive and well despite the financial challenges many Americans are facing,” Crowell added. “I encourage those who are trying to cut costs to give the gift of their time this holiday season.”

Amid heightened financial stress, Americans are making an effort to budget and cut costs

In good news, one third of Americans (35%) have already budgeted for holiday spending, and another third (36%) are still planning to create a budget.

Many Americans are also trying to take steps to cut back on spending this holiday season, with women employing more cost-cutting measures than men. The most common areas of potential savings include:

In addition to budgeting, almost two thirds of those who celebrate the holidays (64%) plan to have a conversation with their significant other about their holiday spending.

Younger generations especially are getting started on the right foot, as they are even more likely to have this conversation with their significant other than older generations (74% of Gen Z, 73% of Millennials, 65% of Gen X and 55% of Baby Boomers).

Methodology

This survey was conducted online by Directions Research, independently recognized as one of the nation’s leading business decision insight firms. The survey was fielded from October 16-19, 2023 among a demographically balanced nationally representative sample of 1,044 U.S. adults 18 years of age and older.

About D.A. Davidson Companies

D.A. Davidson Companies is an employee-owned financial services firm offering a range of financial services and advice to individuals, corporations, institutions and municipalities nationwide. Founded in 1935 with corporate headquarters in Great Falls, Montana, and regional headquarters in Denver, Los Angeles, New York, Omaha and Seattle, the company has approximately 1,620 employees and offices in 30 states.

Subsidiaries include: D.A. Davidson & Co., a full-service investment firm providing wealth management, investment banking, equity and fixed income capital markets services, and advice; Davidson Investment Advisors, a professional asset management firm; and D.A. Davidson Trust Company, a trust and wealth management company.

For more information, visit dadavidson.com.

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