Pandemic Impact on Holiday Shopping: Budgeting, Big Purchases and Personal Debt
November 24 2020 - 06:00AM
Gift-giving is a ‘go’ for most Canadians leading up to Black Friday
according to a recent survey* by Equifax Canada, with 58 per cent
of survey respondents saying they will spend about the same as last
year and four per cent saying they will spend more on holiday gifts
this year. Only 33 per cent said they will spend less.
While most people will proceed with their holiday shopping
plans, the way in which they shop and celebrate may look and feel
different this year owing to the pandemic. More holiday shoppers
(65 per cent) are likely to shop online this year and 48 per cent
of those surveyed say COVID-19 has impacted their holiday shopping
plans. Furthermore, 56 per cent indicated that they will not visit
with extended family this holiday season; the number climbs to 60
per cent for consumers 55+.
“Despite COVID-19, there’s still a good level of optimism when
it comes to preparing for the holidays,” said Rebecca Oakes,
Equifax Canada’s AVP of Advanced Analytics. “On the bright side it
looks like most people still plan on buying presents, even if
they’re staying away from extended family to protect them this
holiday season. However, it’s important to take stock of your
finances and prepare a realistic budget to avoid any unpleasant
bills in the New Year.”
CREDIT CARDS AND DEBTOverall credit card
utilization remained low with a 10 per cent year-over-year drop in
both Q2 and Q3 when compared to the same time period in 2019.
However, consumer spending which saw a big drop in April and May is
back up to pre-COVID levels in Q3.
Some highlights of the survey results with respect to credit
cards, spending and debt:
- 61 per cent say they use their credit card more often than cash
for purchases
- 54 per cent prepare a budget for holiday shopping
- 33 per cent indicated that it takes a month or more to catch up
on paying for holiday purchases
- 33 per cent have a lot of anxiety about their current level of
personal debt
- 19 per cent regret their holiday purchases once receiving their
credit card bill
To avoid post-holiday credit card hangover, the Financial
Consumer Agency of Canada (FCAC) is encouraging Canadians to take
some time to focus on their personal finances. With November being
Financial Literacy Month in Canada, now is the time to start
planning for the holiday season spending. FCAC recommends making a
budget and assessing your financial situation to determine what you
can afford. With the challenges and uncertainty caused by the
COVID-19 pandemic, it is especially important to make informed
financial decisions. FCAC’s free Budget Planner is a great place to
start.
IMPACT OF COVID-19When asked about the impact
of COVID-19 on their financial situation, the survey revealed:
- 31 per cent agree their job feels less secure because of
COVID-19
- 68 per cent say they have delayed at least one major purchase
since the pandemic began
- 59 per cent delayed a vacation
- 25 per cent delayed home improvement
- 22 per cent delayed a car purchase
- 19 per cent delayed the purchase of a new home
“While nobody likes to delay a major purchase, the data from our
survey supports the fact that most people continue to be
responsible with their debt obligations,” said Oakes. “Taking on
too much debt during times of financial uncertainty can be
stressful. It’s good to be optimistic, but it’s very important to
plan for major purchases. Checking your credit reports is a good
place to start to make sure everything is correct, which can serve
you well when seeking a loan.”
About six-in-ten Canadians are viewing the financial impact of
COVID-19 in a more positive way, with nearly half (45%) saying they
expect their household finances to stabilize in the next six
months. The positive outlook continues with 58 per cent saying they
are spending more time outdoors and 57 per cent embracing a
healthier lifestyle.
To learn more about how credit works, consumers are encouraged
to visit Equifax Canada’s education hub. The site offers insights
on how different actions may impact their credit scores and
provides resources to help improve their financial literacy.
*An online survey of 1,539 Canadians was completed between
September 11-13, 2020, using Leger’s online panel. The margin of
error for this study was +/-2.5%, 19 times out of 20.
About EquifaxAt Equifax (NYSE: EFX), we believe
knowledge drives progress. As a global data, analytics, and
technology company, we play an essential role in the global economy
by helping financial institutions, companies, employees, and
government agencies make critical decisions with greater
confidence. Our unique blend of differentiated data, analytics, and
cloud technology drives insights to power decisions to move people
forward. Headquartered in Atlanta and supported by more than 11,000
employees worldwide, Equifax operates or has investments in 25
countries in North America, Central and South America, Europe, and
the Asia Pacific region. For more information,
visit Equifax.ca and follow the company’s news on
LinkedIn.
Media Contacts:
Andrew FindlaterSELECT Public Relationsafindlater@selectpr.ca(647)
444-1197 |
Tom CarrollEquifax CanadaMediaRelationsCanada@equifax.com (416)
227-5290 |
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