Cash is at the top of the mind for many Americans this holiday season: They’re either gifting it or cutting back on it.
More than half say they’re planning to spend less on the holidays this year, according to a new poll. An investment firm called MassMutual U.S. asked 1,500 Americans about their holiday spending plans.
The poll’s top two reasons for cutting back: rising inflation and fear of a recession.
“While many have proven to be resilient, our latest index reveals the increasing toll of inflation along with dampening prospects for the holiday season,” said Mike Fanning, head of MassMutual U.S. “The good news is that people can take steps now to better secure their financial future.”
READ MORE: How to Make a Holiday Budget
Stepping away from tradition
This year, many Americans understand the importance of money over material items.
Fear of rising inflation and a potential recession has more than 3 in 5 respondents planning “to give cash or a gift card” for the holidays.
Debt.com’s annual holiday shopping poll shows many are getting creative in other ways. Six in ten are shopping earlier than previous years to score deals, while more than a third will “spend the same amount but on fewer gifts.”
“Tough economic times sharpen our minds as well as our holiday budget,” says Don Silvestri, president of Debt.com. “During the holidays, we ask ourselves if we really need to buy gifts for everyone – distant relatives and occasional coworkers, for example. Instead, we’ll show how much we appreciate a small selective group.”
READ MORE: This Holiday Season, Give Cheap Gifts
“I’ll be home for the holidays”
Not as in traveling to see the family, though. Six in ten Americans told Mass Mutual they “have no travel plans this holiday season.”
Close to a quarter (22 percent) blame the economy as their main reason not to visit loved ones this year.
Travel costs can add up quickly around the holidays. Back in September, a travel booking app called Hopper released its “2022 Travel Outlook.” Data from the app shows a flight around the end of December can head north of $460. And rising gas prices won’t justify hitting the road to save.
Fanning only sees his firm’s survey results as positive steps to weather the tough economic times. And recommends further budgeting and planning as we head into 2023.
“It is important to take deliberate, thoughtful steps to shore up your finances and spending plans to endure whatever may come,” said Fanning. “As we approach the end of the year, people should create a plan that is flexible enough to weather times of uncertainty and help position them to reach their longer-term financial goals.”
READ MORE: Don’t Make These 5 Holiday Money Mistakes