Gifts, food, decorations and more

The holidays are quickly approaching, and your shopping may already be in full swing as you search for the perfect presents and festive decorations to celebrate Christmas, Hanukkah or Kwanzaa. Shoppers expect to spend an average of $902 per person on gifts and other holiday expenses during the 2024 holiday season, according to the National Retail Federation (NRF) Holiday and Seasonal Trends survey.

The NRF forecasts total holiday sales in the U.S. this season will total between $980 billion and $989 billion in November and December, which would reflect an increase of up to 3.5 percent over the total spending of $956 billion over last year, the NRF reports. An increase in overall spending this year would mark the 16th straight year of such increases, according to the NRF.

Key Christmas cost statistics

The NRF forecasts this year’s holiday spending to be the highest since at least 2004. The average planned expense per person in 2024 of $902 consists of: 

• $641 in gifts for family, friends and co-workers.
• $261 for seasonal items such as food, decorations and cards.

The prices of your holiday items may be higher this year due to sticky inflation that’s currently at a rate of 2.7 percent. While inflation has been decreasing gradually since peaking in mid-2022, it’s ticked up slightly over the past two months. One of the drivers of inflation is food prices, which are up 12 percent over a year ago — potentially making hosting a holiday gathering a bit less affordable. 

Average cost of Christmas

The NRF’s survey, conducted in early October, reported that of the $641 average that consumers planned to spend on gifts this year, here’s how they planned to allocate it, on average:

• $488 on gifts for family members
• $83 on gifts for friends
• $33 on gifts for co-workers
• $38 on other gifts

Nearly half (45 percent) of holiday shoppers surveyed had said they planned to browse and buy items before November. However, 62 percent said they wouldn’t wrap up their holiday buying until December. Spreading out their shopping budget was the top reason (59 percent) people gave for starting their shopping early. Other reasons given were to avoid the stress of last-minute shopping (45 percent) and prices and promotions were too good to pass up (42 percent).

Average cost of gifts

Among various categories, consumers are expected to spend the most (an average of $279) on clothing and accessories this holiday season, according to Deloitte’s 2024 holiday retail survey. Electronics and accessories comprise the second-largest category, followed by gift cards, with shoppers expected to spend an average of $265 and $263 on those categories, respectively.

Source: 2024 Deloitte holiday retail survey

Gift cards are one of the most common holiday presents given by Americans. Popular gift cards include those for restaurants, food delivery services, streaming services, grocery stores, big box stores and strictly online retailers. Co-branded gift cards also remain popular thanks to their versatility.

Consumers are expected to spend $28.6 billion on gift cards this holiday season, according to the NRF, which reports the following:

• Average number of gift cards consumers will purchase: 3.3
• Average value consumers will put on each gift card: $51.18

How consumers are shopping

When it comes to preferred retail formats for holiday shopping, more than two-thirds (71 percent) of respondents in the Deloitte survey indicated they’d be shopping for gifts from online retailers this holiday season. Significant percentages also indicated they’d shop from mass merchant retailers (55 percent) and department stores (31 percent). (Respondents could select more than one answer.)

When asked to identify the top attributes while selecting a retailer during holiday shopping, respondents selected the following options:

• High quality: 39 percent
• Getting a great deal: 37 percent
• A variety of products/styles: 35 percent  

Holiday shopping on smartphones is a popular option this year, especially among younger generations, with 62 percent of millennials planning to do shop this way, followed by 58 percent of Generation Z, 47 percent of Generation X and 30 percent of baby boomers, according to the Deloitte survey.

The survey also found 20 percent and 18 percent of Gen Z and millennials planned to buy gifts on social media, respectively, compared with 12 percent of Gen X and 6 percent of baby boomers.

Holiday spending budgeting tips

Getting the most out of your holiday spending budget requires some creativity, planning and research. Shopping as early as possible can help mitigate shipping delays and increase the chances items will be in stock. Here are some additional shopping tips that may save you some time and money this holiday season:

• Make a list and check it twice. Gather the names of everyone you plan to buy gifts for, along with ideas of one or more gifts they would like.
• Create a holiday spending budget. Using a spreadsheet or a simple piece of paper, determine how much money you have to spend and allocate a dollar amount for each gift recipient, along with categories like decorations, greeting cards and food.
• Give handmade gifts, when appropriate. If you’re a scrapbooker, photographer or baker, put those skills to work by gifting items like photo albums or homemade sweet treats. (You can hardly go wrong with giving food items as gifts, as long as you’re mindful of any food allergies the recipient may have.)
• Go with a Secret Santa or grab bag gift exchange. These ideas are a good option for large families or anyone for whom holiday spending can get out of hand. Each person draws a name in advance and buys a gift for that person only. Decide upon a spending habit with which everyone is comfortable.
• Start planning for next year. Start setting aside money now in a high-yield savings account or a dedicated Christmas Club account for next year’s holiday expenses. Getting a head start will reduce stress next year and help avoid credit card debt. Also, keep track of gift ideas when they come to you throughout the year, to eliminate last-minute angst about what to get someone.

Ways your bank can help you save money for holiday shopping

When it comes to saving money for the holidays or finding the best prices on gifts, there are various ways your bank or credit card company may be able to help.:

Saving buckets: Some savings accounts, such as the one offered by Ally Bank, allow you to set up buckets and assign portions of your money to them. Having money set aside for gifts you plan to buy can remove much of the stress from your holiday shopping.

Round-up savings accounts: One convenient way to add to your savings — whether its for planned gift shopping or other purposes — is by using a bank account that lets you round up the change from debit purchases and transfers it automatically to savings. An example is the Keep the Change program from Bank of America.

Rewards programs: Whether you’re shopping during the holiday season or throughout the year, various programs, such as Chase Ultimate Rewards, allow members to earn points on purchases and redeem them for rewards. Capital One Shopping searches retailers to help you find the best prices on items you’re planning to buy. It also awards points that can be redeemed for gift cards.