Parents who set a budget are more likely to do all their shopping online
Overspending online can seem tempting, especially during the holidays. But for many parents, it keeps them in line.
A T. Rowe Price survey found that parents with budgets are more likely to shop online rather than in-store, with 39 percent of parents opting for clicks versus 23 percent of parents who brave the crowds.
“There is some evidence that shopping online can provide an element of impulse control and help parents stick to their budgets,” says T. Rowe Price senior financial planner Judith Ward. “And, not surprisingly, most parents who never stick to their budget aim to get everything on their kids’ wish lists, no matter the cost.”
Just like in everyday shopping, not having a budget can end up costing you a lot more than you anticipated. Parents who don’t have a budget are more likely to shop in-store (36 percent vs. 18 percent of budgeters) and during the holidays, impulse buys are higher than normal. Not sticking to a budget can mean a lot more gift-buying — even if what you buy isn’t something anyone wants or needs.
Non-budgeters also face using money they don’t have or pulling from savings. T. Rowe Price says parents who don’t stick to budgets during the holidays are more likely to spend from emergency savings (6 percent), retirement savings (9 percent), and even payday loans (12 percent).
Even though budgeting parents will shop more online than in-stores, parents overall prefer to head out for their holiday shopping, as opposed to shopping online. In general, 42 percent of parents will predominantly hit brick-and-mortar stores, while 31 percent will mostly shop online.
‘Tis the season for (self)-giving
It’s not only the season for giving to others. Clearly, it’s also time to give to yourself. For some parents more than others. T. Rowe Price says that 60 percent of parents shop for themselves during the holidays, with 37 percent spending more on themselves than on their kids.
Parents are also saving up big time. Most — 82 percent — wait until the holidays to make big purchases, instead of buying them throughout the year. They’re saving more, and saving earlier: almost half — 48 percent — start saving immediately after the holiday season ends.
Like expected, most of them are also taking advantage of big savings. Last year on Black Friday, 52 percent of parents shopped online (46 percent in-store), and 44 percent made purchases on Cyber Monday. But plastic still reigns: 59 percent of parents used credit cards to make purchases last year, and 90 percent of those parents pay off their holiday spending within six months.
Even with all the budgeting and planning, parents are still overspending. The survey says 58 percent of parents spend more than they should have over the holidays, while two-thirds say they spend more than $1,000 on holiday-related things. There’s a small minority of 11 percent that spend more than $5,000.
It’s probably because of they want to completely please their kids. Most parents — 58 percent — want to get everything on their kid’s wish list. And 66 percent of kids expect their parents to get them anything they want. Naturally, that mindset will last them all the way to college.
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Article last modified on June 28, 2018. Published by Debt.com, LLC . Mobile users may also access the AMP Version: Budget Holiday Shopping Means Online Shopping - AMP.