Nearly half of US parents expect to tell their children they won't be able to afford everything on their holiday wish list, according to an Intuit Credit Karma survey released last month.
What's more, 47% of parents worry their children will be disappointed with the number of gifts they receive compared to their friends and 52% are concerned they aren't doing enough to make the holidays memorable.
About two-thirds of parents plan to buy "practical or necessary gifts" to save on costs, while 45% are willing to go into debt for their children.
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Not just parents
Parents aren't the only ones sweating over holiday spending. Just under half of all Americans are stressed about holiday finances and 39% feel they have to spend more than they can afford, the Intuit Credit Karma survey found.
Younger generations are feeling the strain harder than most, with 51% of Gen Z and 50% of Millennials saying they feel pressured to break the bank.
"Don't be afraid to communicate openly with friends and family about your spending limits, and explore creative, budget-friendly ways to celebrate," Courtney Alev, consumer financial advocate at Intuit Credit Karma, said in the statement announcing the survey results.
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Americans are entering the holiday with debt
One reason for Americans' concerns over holiday spending is that 40% of people are entering the holiday season with existing debt, according to the survey. Just under a third of US adults have $5,000 or more in debt.
Debt-ridden consumers feel they have less financial wiggle room as they shop, the survey said.
Macroeconomic factors like rising prices and import tariffs are also to blame. A third of American consumers said economic uncertainty and the desire to save money were two of the biggest reasons for adjusting their holiday spending, and 27% said a lack or reduced income caused them to shift their spending habits.
Tariffs are the biggest concern on shoppers' minds, with 81% of survey respondents worrying import duties could impact holiday costs.
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Holiday spending habits are changing
American shoppers are planning on changing the way they shop for gifts and the types of presents they'll buy, the survey said. Here are the top money-saving strategies being used by consumers this holiday season:
- Shopping sales more aggressively (36%)
- Cutting back on discretionary spending (32%)
- Using loyalty programs and rewards points (31%)
- Shopping at discount stories (29%)
- Cutting down gift lists (28%)
- Not traveling / traveling less (19%)
More than a third of consumers have already started their holiday shopping in an effort to save money, the survey said. Of those, 44% said they wanted to spread out the financial impact and 37% did so to avoid future price hikes.
Additionally, many Americans are opting for alternative gift choices to soften the economic blow, according to the survey, including:
- A "one gift" rule (31%)
- Homemade gifts (29%)
- Gifting experiences, like tickets to an event, concert, or trip (24%)
- Gifting necessities like household items, subscriptions/memberships, or groceries (22%)
- Charitable donations (14%)
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