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Survey: Holiday spending stressing Americans’ finances

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While holiday spending continues to be anxiety-inducing for some, many American workers are trying to beat the holiday blues by giving back and planning ahead, new research shows.

Principal Financial Group unveils this finding in “The Principal Financial Well-Being Index: American Workers.” Conducted by Harris Poll, the survey polled 1,122 American workers employed at small to mid-sized business across geographies and demographics. The Index is part of a series of quarterly studies commissioned by The Principal Knowledge Center examining the financial well-being of American workers, business owners and advisor opinions and practice management.

According to the study, nearly two-thirds of Americans say holiday spending stressed their personal financial situation. Men fare better than women, with 40 percent saying the holidays put no stress on their financial situation, compared to only 30 percent of women who share their sentiment. Men are also more likely than women to say they’re happy with their overall financial situation (46 percent vs. 32 percent).

This year, half (52 percent) plan to set a budget for holiday gifts, and 85 percent of those who set a budget are likely to stick to it. Perhaps that number should be higher, given that in 2015, workers reported that they blew their yearly budget on:

  • dining out (24 percent)

  • food/groceries (19 percent)

  • entertainment (15 percent); and

  • other consumer goods (15 percent), among other things.

“It’s not surprising to see that American workers continue to blow their budget dining out,” said Kevin Morris, vice president of retirement and income solutions at the Principal Financial Group. “It’s easy to spend $30 here and $40 there on a meal and not think twice about it. But what if they put that money toward something more long-term, like retirement? Or building up their savings? Over time, those pizza deliveries and nights on the town add up and can make a huge difference in your budget.”

We’re working on it

The good news is there are some encouraging signs around holiday spending, even if people are stressed about it. Four in five workers (78 percent) plan to use cash, debit cards or credit cards (that they plan to pay off) to purchase holiday gifts.

The top New Year’s resolution is putting money into a savings account each month, which jumped to 31 percent from 24 percent in 2014. Top money management priorities remain paying down debt (28 percent), saving for retirement (25 percent) and building a savings account for emergencies (15 percent).

People are also planning ahead, which may help them eliminate stress. Three-fourths (76 percent) plan to begin their holiday shopping by or on Black Friday. Women are more likely than men to have begun their shopping early. Women (57 percent) are also more likely than men (37 percent) to control portion sizes in order to manage their weight during the upcoming holiday season.

This holiday season, 71 percent of employees plan to “give back” in some way. Baby boomers are more likely than younger generations to donate money or goods to charitable organizations. Millennials are more likely to volunteer time as a way to give back this holiday season.