More than a third of Kiwis are planning to put their Christmas spending on the credit card this year. Photo / 123rf
More than a third of Kiwis are planning to put their Christmas spending on the credit card this year. Photo / 123rf
More Kiwis are looking to put Christmas on the plastic this year as finances continue to tighten, according to a recent survey.
Banked’s Christmas Spending Survey of more than 1000 New Zealanders found 34 per cent of people will use a credit card as the main way they will payfor Christmas — a 14 per cent increase from 2022.
Forty-one per cent said they plan on using money they saved as the main way of covering the cost of Christmas, down 15 per cent from last year’s survey (56 per cent).
A third (33 per cent) also expect to spend more this Christmas than they did last year, while 42 per cent expect to spend about the same.
Sasha Lockley, Money Sweetspot co-founder and CEO, said the lingering financial consequences of a debt hangover could leave some people feeling less than merry in the new year.
“Getting into debt for Christmas means that many families will start 2024 with a debt hangover that lasts much longer than the Christmas weight gain,” Lockley said.
“Christmas is a tempting time to borrow but, in reality, it is far harsher and more damaging to repay long-term, especially if you’re already feeling financially distressed.”
Lockley warned of the allure of holidays and large sales, particularly if the costs are beyond your means.
“Adding to your loan amount can feel like a quick and easy fix, even providing a short-term sense of relief for people,” Lockley said.
“Making conscious and informed purchasing decisions this Christmas is more important than ever if you’re feeling financially stressed.”
Sasha Lockley, Money Sweetspot co-founder and CEO, warns against getting into debt at Christmas.
Lockley’s warning comes as recent data from credit bureau Centrix revealed the demand for credit and the number of people falling behind on repayments were increasing.
Demand for credit cards rose 11.8 per cent year-on-year compared with November 2022, according to Centrix.
Meanwhile, credit card arrears rose 4.4 per cent in October when compared with September and were up 8 per cent year-on-year.
Consumer arrears rose to 11.8 per cent, with 431,000 people of the credit-active population being behind on their payments in October.
However, New Zealanders are feeling less stressed about the cost of this year’s Christmas when compared with last year, according to Banked.
Forty-eight per cent of people say they feel either a little or very stressed about the cost of Christmas, down 12 per cent from last year (60 per cent).
But there was a big gap between the two genders, with more than half of women (57 per cent) reporting feeling stressed about the cost of Christmas, compared to 38 per cent of men.
Gen Z was also the most stressed about the cost of Christmas (55 per cent), followed by Gen X (53 per cent), millennials (45 per cent) and baby boomers (40 per cent).
Notably, both Gen Z (41 per cent) and millennials (40 per cent) think they will spend more money this Christmas than last year, compared with the more conservative older generations Gen X (19 per cent) and baby boomers (7 per cent).
Cameron Smith is an Auckland-based journalist with the Herald business team. He joined the Herald in 2015 and has covered business and sports.
