Rising Costs Lead Many to Rely on Credit Cards for Holiday Spending
With the holiday season fast approaching, a new survey from CPA Canada and BDO Debt Solutions shows that nearly all Canadians (over 90%) expect to feel financial strain. As the cost of living rises, many Canadians are turning to credit cards to help manage their holiday expenses.
Quebec Shows Lower Financial Stress, More Conservative Budgets
One region bucking the trend is Quebec, where residents report feeling less holiday financial stress compared to the rest of the country. In fact, over 50% of Quebecers say their stress levels are similar to last year. Quebecers are also planning to spend significantly less than the national average. On average, Quebec households expect to spend $436 less than the $2,825 national average on gifts, travel, and entertainment. While many are tightening their belts, 38% still plan to host holiday gatherings, showing that community celebrations remain a priority.
Holiday Spending Trends: Cutting Back and Sticking to Budgets
Across the country, many Canadians are adjusting their holiday spending plans. The average budget for gifts has dropped by 8% this year, from $645 in 2023 to $595 in 2024. The rising cost of living has made it harder for people to stretch their dollars, and younger Canadians—especially Millennials and Gen Z—are feeling the pinch the most. These groups report higher stress levels and are more likely to exceed their holiday budgets. Despite this, 18% of all respondents acknowledge they may overspend.
Travel Plans Take a Back Seat
Travel is not a priority for most Canadians this holiday season. According to the survey, 57% of respondents will forgo holiday trips entirely. Those who do plan to travel are bracing for a significant increase in costs, with average travel expenses rising by 33%, from $1,219 in 2023 to $1,623 in 2024. Charitable giving is also expected to dip, with only 24% planning to make donations, down from 30% last year.
Taking Control: How to Reduce Holiday Financial Stress
In light of the financial pressures mounting for the holiday season, Canadians are urged to take proactive steps to manage their finances. Setting a realistic budget, tracking spending, and considering alternatives— such as smaller gatherings or finding more affordable travel options—can help ease the strain.
For those already feeling overwhelmed, now is the time to explore resources for managing debt and improving financial literacy. With thoughtful planning and mindful spending, Canadians can navigate the season with less financial stress, ensuring a smoother transition into the new year.
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