A third of Canadians curbing holiday spending:
TORONTO, November 10, 2010 With the holiday
season nearing, Canadians are planning to temper their spending
with almost one-third (31 per cent) saying they will spend
less on holiday expenses this year, according to a recent
RBC survey. Furthermore, more than half (55 per cent) plan
to keep their holiday spending flat and almost one-in-five
(18 per cent) say they are not in a position to give gifts
at all this year.
While most Canadians intend to give gifts this holiday season
(82 per cent), they are planning to spend almost $100 less
this year with an average of $624, compared to an average
of $728 in 2009. In total, Canadians expect to spend approximately
$1,137 on the holidays including gifts, decorations, entertaining
and travel. This is approximately seven per cent less in total
than last year, when Canadians also reported they would be
cutting their holiday budgets.
"Canadians are clearly keeping an eye on household spending
and taking a cautious approach when it comes to holiday purchases,
but there are ways to get into the spirit of the season without
breaking your budget," said Karen Leggett, senior vice-president,
RBC Cards and Payment Solutions. "Setting a realistic
spending limit well in advance and monitoring your purchases
as you go can help ensure you don't end up with unmanageable
bills at the start of the New Year."
The majority of Canadians (63 per cent) plan to fund their
holiday cheer with savings and one-in-five (21 per cent) plan
to use credit cards; however, 20 per cent say they are not
sure how they will pay for the season.
The RBC survey also found that a third of time-crunched gift
givers (35 per cent) plan to do some of their holiday shopping
online this year.
"Whether you want the hustle and bustle of the in-store
experience or are looking to save time by shopping online,
using a credit card for purchases offers both convenience
and protection. This is also a great way to keep track of
expenses and take advantage of card rewards programs even
if you use your savings to pay the balance by the due date,"
RBC offers the following tips for holiday spending to help
ensure that you stick to your holiday budget while enjoying
the spirit of the season:
- Cash in your points - If you've collected reward
points that haven't been used consider redeeming them for
store gift cards or merchandise that can be given as gifts
without spending an extra penny.
- Don't spend more, spend smart - If you plan on
covering your holiday costs with savings, you can actually
make your money work harder by using a credit card for purchases
and then paying off the balance by the due date. Many people
rely on their credit cards for larger purchases but may
not use it for everyday shopping instead of using cash.
Holiday spending on groceries, gas, restaurants and clothing
can add up quickly, and using your card can make it easier
to keep track of your expenses. You will also earn rewards
more quickly while taking advantage of a temporary interest-free
loan on purchases.
- Take advantage of time-limited offers - Credit
card rewards programs often have specific times where you
can earn more rewards than usual. For instance, an RBC Visa
Cash Back Card offers one per cent back on purchases and
five per cent cash back on grocery purchases until the end
of December 2010. Using this card could help take a bite
out of gift and entertaining costs.
- Consider RBC Visa gift cards - Have someone that's
'hard to buy for?' Instead of a store gift card, consider
an RBC Visa gift card - it can be used anywhere Visa is
accepted and for a wide variety of items from gas to groceries.
- Purchase Security and Extended Warranty Insurance
- Take advantage of the Purchase Security and Extended Warranty
Insurance on gifts, including many electronic products that
credit cards offer. Need help finding the right card?
Visit the RBC
- Look for the Verified by Visa; MasterCard SecureCode
when shopping online -It's a simple and secure way to
pay at participating online stores, while protecting yourself
against unauthorized use of your card.
- Build up reward points during a heavy spending period
- but be sure to have a plan to pay off your holiday credit
card bills (and consider lower cost borrowing alternatives).
Whether Canadians want to borrow with confidence, get more
from their everyday banking, protect what's important, save
and invest or take care of their businesses, the RBC
Advice Centre www.rbcadvicecentre.com can help answer
their questions. Advice videos are updated regularly to reflect
current trends and to answer the questions that are top of
mind with Canadians. Interactive tools and calculators provide
customized information covering many facets of personal finance.
With the guidance of RBC advisors who are available to chat
live, Canadians have access to free, no-obligation professional
advice about RBC products and services and personalized one-on-one
service. In addition, all personal RBC online banking clients
have access, at no cost, to myFinance
RBC's new online financial management tool, that enables them
to track and manage their money in a simple and clear way.
About the RBC survey
The RBC survey was conducted online via Ipsos Reid's national
I-Say Consumer Panel to 3,160 Canadians (423 British Columbia,
299 Alberta, 219 Saskatchewan/Manitoba, 1,194 Ontario, 775
Quebec, 249 Atlantic Canada). Weighting was then employed
to balance demographics and ensure that the sample's composition
reflects that of the adult population according to Census
data and to provide results intended to approximate the sample
universe. Data collection was October 4-11, 2010. A survey
with an unweighted probability sample of this size and a 100
per cent response rate would have an estimated margin of error
of ±1.7 percentage points, 19 times out of 20, of what
the results would have been had the entire population of adults
in Canada been polled.
- 30 -
Kathy Bevan, RBC, (416) 974-2727
Jacqui van der Jagt, RBC, (416) 974-1756