Crystal Honores, 35, an editor from Tarrytown, N.Y., took on freelance gigs this year to pay off credit card bills and student loan debt. There was little left over for extras.
Now though, she has worked down a chunk of her debt and has more discretionary income. So she plans to spend more this Christmas — on herself. Honores is already eyeing a Miele canister vacuum, and accessories like new scarves, belts and jewelry.
She won’t be alone at the checkout counter. This holiday season, many American consumers will spend more on gifts for themselves, the National Retail Federation reports. According to a NRF survey, 60% of shoppers polled plan to shell out $130.43 for their own gifts, up from $112.20 in 2010.
Recession-scarred shoppers are tired of cutting back, and ready to give in to their pent up spending impulses, experts say.
There’s a feeling of “buy now because you might not be able to buy it later, because you might not have a job,” says Honores. “It’s a very carpe diem attitude.”
“Most people have viewed profligate spending as bad manners coming out of the recession,” Paco Underhill, founder of Envirosell, the consumer behavior research and consulting firm, tells DailyFinance. Suddenly, “we were taking pride in how little we spend rather than how much.”
But a certain recession fatigue has now set in among consumers. “And the holidays are a season that give us permission to open up our wallets.”
Lew Paine, senior vice president of GFK Consumer, a retail, technology and media market research firm, agreed.
“Consumers have been deferring purchases and practicing fairly severe austerity since the beginning of the recession. The holiday season provides them with a positive rationalization for personal rewards through self-gifting.”
Shoppers have also become numb to the gloom that still lingers over the economy. “Scary times have become the norm,” Underhill says. So at this stage in the post-recession economy, “people have stopped looking at the declining values of their houses, stock market fluctuations — maybe for their own piece of mind. They’ve gone back to living.”
Less For Them, More For Me
Hard times have also made it socially acceptable to buy more modest gifts, which frees up cash for me. The thinking is, “I will buy someone the $10 present rather than the extravagant $30 present, that frees up the spending cap,” Underhill says.
At the same time, consumers are more likely to buy gifts for themselves if they expect less from others, Paine says.
If you made a pact with your cousin to break tradition and forgo exchanging those holiday sweaters, for example, “you still need a new sweater, so you purchase it as a gift for yourself.”
What’s more, many shoppers who “traded down” during the recession to cheaper stores, opting for Target (TGT) instead of Macy’s (M), for example, justify a self-purchase during the holidays because they’re theoretically buying less pricey goods, Underhill says.
But fundamental social shifts could also be feeding the self-gifting trend.
For one, the once traditional makeup of the family unit has been redefined, which has shaken up gift-giving patterns.
According to the latest Census date, fewer than 25% of American households are made up of a traditional mother and father and dependent children, Underhill says. “This whole Ozzie Harriet picture of presents under the tree, while it still exists, might not actually be the norm anymore.”
The shift has seen the rise of DINK (double income no kids) households, which are more prone to self-gifting, he says.
“The gift-giving patterns are very different if you don’t have kids. You can [more] often think about treating yourself.”
Tagged: christmas shopping, ChristmasShopping, consumer spending, ConsumerSpending, Finance, holiday shopping season, holiday spending, HolidayShoppingSeason, HolidaySpending, Macy’s Inc, National Retail