Only about half of American adults (54 percent) plan to spend $300 or more on holiday gifts this year, a 10 percent decrease from what Americans last year said they typically spend, according to a survey commissioned by ING DIRECT.
Only 11 percent plan to spend between $1 and $100 this year, unchanged from 2008, and 23 percent plan to spend $100 to $299 compared to 21 percent last year. Another 11 percent don’t plan to spend any money on gift giving in 2009, compared to 7 percent in 2008, a 57 percent increase. Spending between $500 and $999 is expected to change from 25 percent in 2008 to 23 percent this year, and spending $1,000 or more is projected to change from 12 percent in 2008 to 10 percent this year.
Northeasterners are cutting back the most: only 57 percent of Northeast residents said they will spend $300 or more on gifts, compared to 71 percent last year. The change is most dramatic among Americans age 55 or older. Only 61 percent of older Americans are planning to spend $300 or more on gifts this year, compared to 71 percent least year.
Some 41 percent of Americans say their top priorities will be to save more and spend less for the remainder of the year. (In May the U.S. personal saving rate reached 6.9 percent, the highest it is been since 1993, according to Forbes.com). And 67 percent say they will continue their frugal ways and saving even after the economy recovers.
Of course, without increased consumer spending, that recovery may be longer in coming. Consumer spending accounts for about 70 percent of all demand in the U.S. economy, according to the Wall Street Journal. Some 60 percent of economists responding to a Journal survey said a substantial increase in consumer spending was needed for sustained growth.