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Debt takes a holiday: Canadian overspending drops this holiday season as more shoppers stick to their budgets – RBC poll

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TORONTOFeb. 6, 2019 /CNW/ – Overspending dropped significantly among Canadian shoppers this past holiday season, to an average of $384 (vs. $530 in 2017), down 28% – the lowest level in eight years, according to the annual RBC Post-Holiday Spending & Saving Insights Poll.

 

 

The biggest drop was among 18- to 34-year-olds and women, who cut their overspending by almost $200 ($363 and $379 respectively) compared to 2017. While there was only a slight decline in the number of Canadians who spent more than expected (40% vs. 42%) the good news is that almost one-third (30%) of these overspenders report they have already paid off their seasonal shopping spree.

“We’re all tempted to toss aside the budget during the holiday season, but what a good news story to see that Canadians showed restraint this year and far fewer are entering 2019 with holiday debt weighing them down,” said Vinita Savani, Vice-President, GICs & Savings, RBC. “Canadians are starting 2019 off on the right foot – their next step will be managing their spending throughout the year and seeing if they can build up their savings too.”

The RBC poll also surveyed Canadians about their ability to save and found it continues to be a challenge. When asked if they had any idea how much more they might be able to set aside above what they are currently saving, one-quarter (23%) responded that they weren’t saving regularly now and weren’t expecting to be able to save anything ‘extra’.

“Regular savings is challenging for many people – can I find anything extra to save and how much if I can?” added Savani. “We heard the challenges and developed NOMI Find & Save to do all the work for you. By proactively analyzing your spending and saving, NOMI finds extra money we think you won’t miss and automatically sets it aside for you in a savings account. Before you know it, you’ve saved enough to start daydreaming about what you will do with your ‘found money’. And we know that this past year, some of these found savings helped take care of people’s gift lists.”

Since launching in October 2017NOMI Find & Save has helped Canadians save more than $60 million – with active NOMI Find & Save clients saving on average $150 per month. In addition, NOMI Find & Save is now available to joint account holders, helping even more clients automatically accelerate their savings.

National poll highlights

Average amount spent by Canadian holiday shoppers per gift category:

  • giving experiences to family and friends ($129)
  • gift cards ($119)
  • electronics ($102)
  • toys ($96)
  • entertainment ($51)
  • gifts for pets ($29)
  • giving to charities on behalf of family and friends ($28)

Average amount Canadian holiday shoppers spent over their budgets by age group:

  • 18 to 34: $363
  • 35 to 54: $434
  • 55+: $334

Actions overspenders with unpaid holiday bills are planning to take to get their finances back on track:

  • Spend less on entertainment, lunch and coffee (30%)
  • Spend less on day-to-day living expenses (25%)
  • Carry costs on credit card; paying off the balance in two months or more (20%)
  • Carry costs on credit card; paying off the balance immediately (14%)

Regional comparisons & national gender findings

Overspent?

NAT’L

BC

AB

SK /
MB

ON

QC

AC

M

F

Yes

40%

43%

39%

48%

43%

34%

33%

39%

41%

By how much?

$384

$464

$404

$500

$410

$230

$357

$389

$379

How overspenders
will pay holiday bills?

NAT’L

BC

AB

SK / MB

ON

QC

AC

M

F

Spend less on lunch &
coffee, entertainment

30%

34%

34%

28%

26%

34%

37%

29%

31%

Spend less on day-to-
day living expenses

25%

32%

24%

26%

24%

21%

29%

25%

25%

Carry costs on credit
card; pay off balance
in two months or more

20%

15%

20%

21%

22%

18%

19%

22%

18%

Carry costs on credit
card; pay off balance
immediately

14%

14%

7%

20%

16%

14%

7%

15%

13%

Carry costs on my
line of credit

8%

6%

9%

18%

7%

6%

5%

10%

6%

I’ve already paid
my holidays bills off

30%

28%

35%

36%

30%

29%

28%

31%

30%

Don’t know how I’ll pay
holidays bills off yet

8%

9%

3%

6%

9%

6%

12%

7%

8%

Average amount spent
by holiday shoppers
per gift category

NAT’L

BC

AB

SK /
MB

ON

QC

AC

M

F

Toys

$96

$85

$116

$106

$107

$77

$80

$93

$99

Electronics (e.g.
mobile devices,
computers, gaming
consoles)

$102

$106

$92

$84

$108

$93

$124

$132

$74

Entertainment (e.g.
DVDs, games/video
games, books /
eBooks, iTunes)

$51

$47

$62

$50

$52

$48

$51

$60

$43

Giving experiences to
family, friends

$129

$110

$114

$168

$149

$97

$153

$137

$122

Gift cards

$119

$118

$95

$187

$118

$103

$150

$113

$124

Gifts for pets

$29

$21

$29

$29

$36

$20

$36

$33

$25

Giving to charities on
behalf of yourself or
family, friends

$28

$16

$23

$44

$32

$26

$27

$34

$21

 

About NOMI and NOMI Find & Save
RBC continues to introduce a variety of digital capabilities to evolve into a digitally-enabled relationship bank. Since the introduction of NOMI in the RBC Mobile app, NOMI has helped our clients understand more about their everyday finances so they can save and spend wisely. Keeping clients connected to their money so they can confidently make better financial decisions, NOMI proactively analyzes current and past financial behavior to provide personalized insights. The RBC Mobile app is the most used money management platform in Canada, available to over 4 million RBC clients. NOMI Find & Save proactively analyzes a client’s spending behaviours to find extra money that won’t be missed, and automatically sets it aside as savings. Since launching in October 2017, NOMI Find & Save has helped Canadians save more than $60 million – with active NOMI Find & Save clients saving on average $150 per month. In addition, NOMI Find & Save is now available to joint account holders, helping even more clients automatically accelerate their savings.

About the RBC 2019 Post-Holiday Spending & Saving Insights Poll 
These are the findings of an Ipsos poll conducted on behalf of RBC from January 2 to 5, 2019. A sample of 2,001 Canadians aged 18+ was surveyed using the Ipsos I-Say panel. Quota sampling and weighting was employed to ensure the sample’s composition reflects that of the actual population of Canadians, according to Census data. The precision of online polls is measured using credibility interval. In this case, the results are accurate to within ±2.5 percentage points, 19 times out of 20, of what the results would have been had the entire population of adults in Canada been surveyed. Credibility intervals will be wider for smaller subsets of the population.

SOURCE RBC Royal Bank

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