New York, Dec 28 (IANS) As much as 36 per cent of Americans took on holiday debt this holiday season, up from 34 per cent a year ago, according to the latest holiday debt survey of LendingTree, the nation’s online loan marketplace.
Those Americans who racked up balances added 1,181 US dollars of debt on average, up from 1,028 dollars in the same period of 2023, Xinhua news agency reported.
“While the holidays offer a cheerful reprieve, post-spend regret is still rampant,” said the survey.
The survey showed that 60 per cent of those who took on debt felt stressed about it and 42 per cent regretted spending as much as they did, with only 44 per cent of them going into debt as planned.
Among those indebted consumers, 65 per cent used credit cards for purchases, and 21 per cent used buy-now-pay-later (BNPL) loans with 19 per cent using personal loans.
Moreover, the high-interest rate backdrop was exposing consumers to heavier debt, with 42 per cent of them saying the highest interest rate they paid was 20 per cent or higher.
Most consumers planned to pay off their debt well into the new year, with 21 per cent expecting it to take five months or more to pay off their debt, and 20 per cent only making minimum payments, according to the survey.
Inflation is still a big deal in this country, and it’s having a huge impact on people’s finances, including their holiday spending. It’s fair to expect holiday debt figures to increase over the years, according to Matt Schulz, LendingTree’s chief credit analyst.
“If you were to only buy the same things you bought last Christmas, you’d likely have to spend more this year thanks to inflation. For many Americans, that means you either have to cut back on gifts or take on more debt,” said Schulz.
The US overall retail sales increased 3.8 per cent year on year during the period of November 1 to December 24, according to the preliminary data released by Mastercard on Thursday.
The last five days of the holiday season alone accounted for 10 per cent of all holiday spending, said Mastercard SpendingPulse.
–IANS
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