Here's how much the average American will spend for the holidays, by city

For many, the holiday season represents generosity, connection with family and friends, a celebration of faith – and also, spending money.

While celebrating the season is more than gifts under the tree, it’s also a big time for consumer spending. Holiday sales in 2024 are expected to grow between 2.5% and 3.5% from last year, reaching more than $980 billion, according to the personal finance website WalletHub, which published a report Tuesday on holiday budgets by city.

In fact, the average American is expected to spend $1,778 this holiday season, Deloitte forecasted – noting a "rosier economic outlook" and perceived higher prices.

Coupled with rising average household credit card debt, holiday purchases can have a lasting impact long after Christmas day.

"Depending on the city, an American’s holiday budget this year can range anywhere from just over $200 to more than $4,000, taking into account residents’ income, their existing debt obligations, and the cost of living," WalletHub analyst Chip Lupo said.

"Regardless of how well-off you are this season, it’s important to stick to a budget that fits your financial profile so you don’t rack up unsustainable debt and end up in a bad position after the holidays," Lupo added.

Money-saving tips for the holidays

When trying to avoid overspending during the holidays, experts say to make a list and set a budget.

"For many consumers, overspending happens when they feel time crunched or make snap decisions in response to discounts or limited offers," said Amber M. Epp, a associate professor of marketing at the University of Wisconsin – Madison's School of Business.

"Consumers can save money in the traditional ways by making budgets and lists this time of year, but also by comparison shopping and seeking out discounts for items already on their lists rather than impulse buying when presented with sales."

Another tip is to seek out holiday traditions that have zero or little cost.

"Spending time with family, friends, undertaking your favorite activity like going on a hike, group activities – especially those that allow you to use your brain, move your body, and socialize – can be the things that really make these times special and deal with the underlying stress during the holidays," Dr. Altaf Merchant, a professor of marketing and Dean at the University of Washington Tacoma's Milgard School of Business, told WalletHub.

Lastly, avoid impulse shopping and emotional online purchases.

"Influencers on social media, such as TikTok, will continue to have a big social impact on people’s spending decisions," noted Tracy Lu, an associate professor of event planning and customer service at the University of Kentucky.

The Source
This story was written based on information published on Nov. 19, 2024, by the personal finance site WalletHub. To determine the cities with the biggest holiday budgets, WalletHub said it compared 558 cities across five key metrics: 1) Income, 2) Age, 3) Debt-to-Income Ratio, 4) Monthly Income-to-Monthly Expenses Ratio and 5) Savings-to-Monthly Expenses Ratio. It was reported from Cincinnati.