Halloween costumes, Valentine's chocolates and Christmas gifts: what do these three things have in common? Yes, they are all symbols of cherished holidays but they are also major budget-busters for consumers across the nation.
Okay, I know what you're thinking: this tightfisted Scrooge doesn't realize you can't put a price on magical events like Thanksgiving feasts, Easter egg hunts and Christmas tree lightings. Don't get me wrong. I love holidays just as much as the next gal. However, few people are fans of massive debt and that's exactly what reckless holiday spending can get you. (Read Avoid Overspending This Holiday Season for tips for a bountiful Yuletide on a Scrooge-like budget.)
But you don't have to take our word for it. Just look at the numbers. Here are some statistics on how much cash the average American burns up on holiday spending each year:
Frightening Halloween Expenses
Based on a National Retail Federation survey, U.S. consumers plan to spend an average of $56.31 on Halloween paraphernalia this year. That certainly seems like a substantial chunk of money to spend on costumes, decorations and candy.
However, that amount is actually down from the $66.54 Americans spent in 2008, which proves that that the tough economy is scaring some trick or treaters.
Ah, Thanksgiving. It's a time to gather with loved ones, give thanks for our blessings and stuff our faces with turkey and dressing until we're forced to change into elastic-waist pants. It's also a time for some serious financial splurging.
Americans spent a total of $28.5 billion on Thanksgiving in 2008, and 90% of that went toward food. According to the American Farm Bureau, the average cost of a Thanksgiving Day feast for 10 was $44.61 last year. That's not too shabby considering that price includes turkey, stuffing, cranberries, pumpkin pie and all the trimmings.
So where did the rest of the money go? Some spend-happy Americans dish out hundreds of dollars for Thanksgiving decorations and other festive flourishes. (These tips will have you singing "Joy to the World" well into the New Year. Check out Holiday Spending Or Spending Holiday?)
And let's not forget the Thanksgiving travel. Many families spend hundreds to thousands of dollars on airplane tickets and fuel to visit their loved ones for Thanksgiving, the busiest travel holiday in North America. In 2008, the average ticket cost for the most popular Thanksgiving travel itinerary (Wednesday to Sunday) was a whopping $490, according to Live Search Farecast. Cha-ching.
Not-So-Cheerful Christmas Costs
Immediately following our Thanksgiving spending spree, Americans start shelling out even bigger bucks for Christmas goodies. In 2008, Americans spent about $460 billion on Christmas expenditures, according to IBISWorld. Some estimates show that the average American spends between $500 and $1,000 or more on Christmas gifts and decorations each year.
Of course, there's no place like home for the holidays. Many Americans pay a pricey visit to their home towns for the yuletide season. Last year, Christmastime travelers spent an average of $420 per plane ticket, according to Live Search Farecast.
Money Can Buy Love, At Least on Valentine's Day
Although countless consumers dismiss Valentine's Day as a "Hallmark Holiday," most Americans still dish out dollars for candy and cards to celebrate the "manufactured" love-fest. According to the National Retail Federation, the average American consumer spent about $123 on Valentine's Day gifts in 2008.
Let's hope the candy companies come up with some new conversation heart messages to add to their usual "Be Mine" and "I Love You" selections. May I suggest, "We're Broke" and "Let's Go in Debt Together"? (Holiday expenses can drown you in debt. Find out how to avoid this festivity hangover in Keep Holiday Debt From Snowballing.)
Hunting for Eggs - and Cash
Chocolate bunnies, Peeps® and jellybeans, oh my! While Easter may seem like a financially harmless holiday, U.S. consumers still find a way to spend big bucks on Easter candy, gifts, food and decorations. As a matter fact, the average American spent about $117 on Easter goodies in 2008, according to the National Retail Federation. As those precious kids in that old M&M's® commercial would say, "Thank you Easter Bunny…Boc Boc!"
Holiday Spending: A Major Budget-Buster
There's no question that American consumers have a torrid love affair with holiday spending. Of course, we've just scratched the surface with the major spending holidays here. There's also Mother's Day, Father's Day, the Fourth of July and even Columbus Day. (Okay, so maybe that last one doesn't induce significant consumer spending…unless you count the endless Columbus Day furniture store and car dealership sales.)
All told, the average U.S. consumer spends $1,500 to $3,000 or more on holiday gifts, goodies, decoration and travel each year. Of course, that's just the average amount. As we all know, many of us refuse to be average. There are plenty of high-rollers out there who shell out $10,000 or more for Christmas expenses alone.
Just think of all the fiscally responsible things you could do with an extra $1,500 to $10,000 each year. You could pay down your credit card debt, contribute more to your IRA, pay off your car loan or beef up your kid's college fund.
So, the next time you reach the year's end and wonder where all your hard-earned cash went, you may want to point a finger at the Easter Bunny, Santa Claus and even the Great Pumpkin. If you're stretched financially thin in these tough economic times, it's time to cut back on your holiday spending. (Find out how to avoid six of the worst vender ploys this holiday shopping season. Don't miss Sneaky Strategies That Fuel Overspending.)
InvestingWe share some lessons from friends and family on saving money and planning for retirement.
Personal FinanceEven if you’re a finance or statistics expert, you’re not immune to common decision-making mistakes that can negatively impact your finances.
Credit & LoansThese terms may sound the same, but they mean very different things for homebuyers.
Options & FuturesInvesting during an economic downturn simply means changing your focus. Discover the benefits of defensive stocks.
InsuranceTough times call for desperate measures, but is raiding your life insurance policy even worth considering?
Fundamental AnalysisA decision tree provides a comprehensive framework to review the alternative scenarios and consequences a decision may lead to.
SavingsLearn 10 key habits for achieving financial freedom, including smart budgeting, staying abreast of new tax deductions and the importance of proper maintenance.
SavingsUnderstand how the problems of ultra-high-net-worth individuals (UHNWIs) are different from ordinary problems, and identify the unique financial challenges they face.
BudgetingThe 2016 race to the White House will largely be determined by who can spend the most money. Here is a look at how much it will cost to win the presidency.
Credit & LoansHoliday expenses can drown you in debt. Find out how to avoid this festive spending hangover.
Out of the 2,800 mutual funds that Morningstar, Inc., the leading provider of independent investment research in North America, ... Read Full Answer >>
Interest rates rarely increase during a recession. Actually, the opposite tends to happen; as the economy contracts, interest ... Read Full Answer >>
With the growth in the size and number of hedge funds over the past decade, the interest in how these funds go about generating ... Read Full Answer >>
Annuities come in several forms, the two most common being fixed annuities and variable annuities. During a recession, variable ... Read Full Answer >>
Mutual funds invest in not only stocks and fixed-income securities but also options and futures. There exists a separate ... Read Full Answer >>
Forward contracts and call options are different financial instruments that allow two parties to purchase or sell assets ... Read Full Answer >>