Move over, Gen X and Boomers – Millennials are taking the lead in holiday spending this year! According to a recent TransUnion survey, a whopping 63% of Millennials plan to spend the same or more compared to last year. But why the shopping spree? It turns out that many in this generation, now proud parents of school-age kiddos, are feeling pretty good about their wallets and future earning potential.
The National Retail Federation is forecasting a record-breaking holiday shopping season, with total spending expected to hit nearly $1 trillion between November and December. That’s a lot of ugly Christmas sweaters and must-have gadgets! On average, shoppers are planning to drop $1,778 on gifts and goodies, up 8% from last year. It seems that even sky-high credit card bills aren’t dampening the holiday spirit.
Speaking of payment methods, while good old plastic still reigns supreme, there’s a new player in town: buy now, pay later (BNPL) services. These modern layaway plans are gaining popularity faster than you can say “add to cart.” In fact, Adobe predicts we’ll see a single-day record of $993 million in BNPL spending on Cyber Monday alone. It’s like having a personal Santa who lets you spread out payments – what could go wrong?
Well, financial experts are waving a cautionary candy cane. Managing multiple BNPL loans could lead to overspending faster than you can polish off a plate of Christmas cookies. Some plans even charge interest rates as high as 30% for missed payments – ouch! So while the holiday spending forecast looks merry and bright, it’s worth remembering that January credit card statements are coming to town. Maybe leave a budgeting app for Santa instead of milk and cookies this year?
