With Christmas just weeks away, most of us are caught up in the pre-holiday hustle and bustle. That means shopping for the perfect gift, a skill I have never managed to master.
I always ask for suggestions, and then I purchase those things with high hopes they won’t end up on a returns counter. Out-of-town family is easy; I send money. Yes, it’s cold and requires little effort, but my checks have never been returned. Gift cards? No way. I hate the hassle involved in choosing them and using them.
Speaking of Christmas. Forbes Magazine reported recently that American consumers are expected to spend an average of $1,500 per person this year on gifts, food, entertainment and travel. If that turns out to be accurate, it would represent a 5% decrease from 2024. Not to get too crazy with the math, but I found some interesting statistics that could explain why.
The average hourly wage nationwide is $35 with average weekly earnings about $1,100. The average annual salary of employed Americans is $51,000. In Wisconsin, holiday spending last year was $1,100, much lower than nationwide. That makes sense, because the median hourly wage for workers here is $25 per hour.
So who’s cutting back on spending? I hate to admit it, but I can never remember the ages assigned to the demographic groups cited in the media so I included that information. That way you don’t have to look it up, and it will serve as a handy reference when I can’t recall it either, which I probably won’t.
Generation Z (13-28) and millennials (29-44) say they will spend less this year, and Generation X members (45-66) say they will increase spending a tiny amount. The only group expected to spend considerably more is baby boomers, 67 to whatever their expiration date is. Boomers plan to increase spending by 5%.
I’m relatively sure this is due to the “Hey, it’s Christmas; gotta spoil the grandkids” effect. That said, a key question is, with a softening economy and rising layoffs, how will Americans pay for a very merry Christmas? You guessed it — credit cards. Using plastic enables spending that would be otherwise impossible.
For example, U.S. consumers spent a record $11.8 billion online on Black Friday, a 9.1% increase over last 2024. All that was done via electronic transactions (credit cards), many of which carry 25-30% interest rates. Sadly, a lot of that money was spent buying children items they insist they can’t live without. Yet studies show that over half of the stuff under the tree will be buried in a landfill by the Fourth of July. Millions of consumers are still paying off debt from last year’s Christmas spending.
The sad truth is that far too many Americans rely on credit to fund an unaffordable lifestyle. The holidays present an especially huge challenge. A relative who works in beverage service tells me he sees a lot of people he knows are of modest means overspend this time of year, especially when they are overserved.
When I was grocery shopping last week, a woman at the checkout presented four cards to the cashier before she found one that was not maxed out. What was she buying? Booze and fancy treats for the holidays.
Given all that, it’s no wonder the Fed reports that as of July 1, credit card debt in the United States was $1.21 trillion. The average American is carrying a mind-boggling $6,473 in credit card debt. Alaskans have the highest average balance at $7,640, while Wisconsinites have the lowest at $5,154. Most of them will pay a sizable percentage of their future income in interest. When will people learn that things don’t make you happy?
I know these are hard times for many people right now. Trust me, I’ve been there. Kids won’t die if they don’t get a sleigh-load of presents.
One special gift that could take the place of a dozen others is a family outing. How about a “voucher” for a visit to the library? Tickets to a local high school event? Maybe ice-skating at your community rink? For a really fun adventure, plan a summer outing like kayaking on one of several beautiful lakes in Townsend (kayaks available for public use at no charge).
One Christmas when I was a little girl, Mom said she read that things were going to be “tight” for Santa. That year I got pajamas, socks and a book, “The Night Before Christmas.” I wasn’t sad; I was proud to know I was helping Santa get through a tough time. What I didn’t realize was that the most important gift I got that year was one I’ve used for over seven decades — the life lesson of living within your means.
Kathleen Marsh is a lifelong educator, writer, and community advocate. She has published eight books, four on the history of Townsend, where she and husband Jon are happily retired on the beautiful Townsend Flowage.
