Canadians to spend less over holidays, says RBC
People shop for Christmas gifts in the Eaton Centre in Toronto on Dec. 23, 2009. (The Canadian Press/Darren Calabrese)
Published Thursday, November 15, 2012 5:21AM EST
TORONTO -- A RBC holiday outlook suggests Canadians may be a little more frugal this festive season.
The RBC Canadian Consumer Outlook found that while the majority of Canadians appear to be in a gift-giving mood, they plan on spending less over the holidays than they did last year.
The survey suggests Canadians who celebrate year-end festivities will spend $1,182 on gifts, decorations, entertaining and travel -- a figure which is down six per cent from last year's anticipated amount.
The bank says this season's holiday spending plans appear to be more in line with Canadians' 2010 holiday purchasing plans.
The survey suggests shoppers who plan on buying gifts are likely to shell out $629 on their purchases, down from the $640 anticipated last year.
RBC also suggests Canadians plan to cut their spending on holiday expenses other than gifts by 10 per cent from last year.
"It's clear that Canadians are conscious of their finances and are taking a closer look at what they can afford this holiday season," said Chris McEachern, financial planning role strategist, RBC Financial Planning.
The results of the RBC survey released Thursday stand in contrast to findings from some other analysts, who believe Canadians will be more generous with their finances over the holidays this year.
A Bank of Montreal survey released earlier this month projected an average 15 per cent jump in holiday spending over last Christmas, with respondents planning to spend $1,610 this season. And an report Ernst & Young predicted Canadian holiday sales would rise 3.5 per cent over last year, supported by signs of improvement in consumer confidence.
Meanwhile, a study from Deloitte projected Canadians will spend one to two per cent more this holiday season, but an increasing number will check for the best prices online before they head to the mall in a season it expects to be highly price competitive.
RBC's survey, however, suggests Canadians will be tightening their belts.
It found 56 per cent of respondents plan to fund their festivities with their savings, while 24 per cent intend to use credit cards.
Meanwhile, 23 per cent of those surveyed say they haven't thought about how they'll pay for the holiday season.
RBC suggests that a little financial preparation for the holidays is likely to go a long way.
"No matter how you choose to purchase your gifts, whether it's with debit or credit cards, in store or online, knowing how you'll cover your holiday expenses is crucial to avoiding unwanted debt and ensuring you are in good financial shape for the new year," McEachern said.
"A little planning ahead of your holiday shopping can make all the difference."
The online survey was conducted by Ipsos Reid and involved 3,375 Canadians across the country between Oct. 1 to Oct. 10. The poll is accurate to within plus or minus 1.9 percentage points of the entire Canadian population.