Christmas spending expected to take a dip, says IBISWorld
From smaller crowds to limited hugs, there's no doubt Christmas will look anything but traditional this year. And according to new research from market researcher, IBISWorld, Aussies aren’t looking to spend big either this festive season.
IBISWorld found that Christmas retail spending is expected to decline across certain areas, such as electronic goods (-2.7%), pharmaceutical and cosmetic goods (-1.5) and department stores (-1%).
“Although many households are likely to receive a cash injection from the recent Federal Budget, there is a high likelihood that these funds will be saved rather than spent, providing little help to the ailing retail sector”, said IBISWorld senior industry analyst, Yin Yeoh.
“Consumer electronics retailing is expected to be 2.7% lower this December, relative to last Christmas. Department store turnover is expected to be 1.0% lower, at $2.8 billion.”
But while we might not be splurging on flashy gifts for our friends and family, grocery and liquor spending is expected to increase by 2.8% and 3.6%, respectively.
“Families are expected to go all-out on their Christmas feasts this year, with many Australians celebrating their ability to reunite with family after states reopen borders and ease social distancing regulations,” said Yeoh.
Unsurprisingly, online spending will also grow by 6.4% in the 2020/21 financial year, as more households make the effort to shop around to get a better deal and reap the benefits of home delivery.
Buy Now, Pay Later (BNPL) will also be a popular payment method among households, as more Aussies are expected to ditch their plastic to avoid holiday debt.
“Mozo research shows that Aussies are taking steps to eradicate their debt during the pandemic, so it’s not surprising to see that Buy Now, Pay Later usage will surge during the holiday season,” said Mozo Director, Kirsty Lamont.
This research correlates with recent research by BNPL platform, OpenPay, which found that almost a quarter of Aussies in Sydney and Melbourne are using BNPL to manage their spending during the pandemic.
Mozo’s top three tips for budget-friendly Christmas spending
If you are thinking about getting a head start on your Christmas shopping, you might be wondering about the best way to score some awesome goodies for your loved ones without breaking the bank. So before you start adding things to your virtual cart, here are our top three tips:
- Set a spend limit - While it’s important to set a budget for your overall Christmas spending, it's also a good idea to set a spend limit for every person you’re buying a gift for. This is a great way to prevent overspending, as you aren’t allowed to exceed your set limit.
- Source some extra cash - According to Gumtree’s 2019 Second Hand Economy report, the average Aussie household has over $5,000 worth of unwanted items that could be sold online. So if you’re looking for a way to make some extra cash, this might be a great way to top up your Christmas fund.
- Organise a Secret Santa - Over the last few months, we’ve seen many Aussies rethinking their spending habits due to COVID-19. If money is tight for your household this year, try organising a Secret Santa amongst your family and friends to save on Christmas shopping.
Need a top place to stash your Christmas fund? Our savings account comparison tool can help you compare some of the latest savings accounts from more than 60 banks.
Compare high interest savings accounts - last updated February 20, 2021
Bonus Saver Account
Maximum rate
standard interest rate
Govt Deposit Guarantee
1.20% p.a. (for $0 to $250,000)0.10% p.a.(for $0 and over)Yes up to $250,000Bonus rate when at least $20 is deposited each month and five Visa Debit transactions are made each month using linked Everyday or Glide transaction accounts.
CompareCompareBonus Saver Account
Winner of a Mozo Experts Choice Award 2021 in the Regular Saver category.^ No monthly account fees and no minimum balance requirements.
- account fee per month
- $0.00
- Maximum rate conditions
- Bonus rate when at least $20 is deposited each month and five Visa Debit transactions are made each month using linked Everyday or Glide transaction accounts.
- Access
- BPay, Phone banking, Internet banking
- Minimum balance
- $0.00
- Other restrictions
- Must link to a transaction account
Read our Mozo Review to learn more about the Bonus Saver Account
Hero Saver
Maximum rate
standard interest rate
Govt Deposit Guarantee
0.80% p.a. (for $0 to $250,001)0.01% p.a.(for $0 to $5,000,000)Yes up to $250,000Minimum deposit of $200 and no withdrawals in the month.
CompareCompareHero Saver
Interest is calculated daily and paid monthly. Automatic payment feature. No minimum opening balance needed.
- account fee per month
- $0.00
- Maximum rate conditions
- Minimum deposit of $200 and no withdrawals in the month.
- Access
- Phone banking, Internet banking
- Minimum balance
- $0.00
- Other restrictions
- -
Read our Mozo Review to learn more about the Hero Saver
Serious Saver
Maximum rate
standard interest rate
Govt Deposit Guarantee
0.80% p.a. (for $0 to $1,000,000)0.05% p.a.(for $0 and over)Yes up to $250,000No withdrawals in the month. Bonus rate for first 4 months, reverting to 0.05% rate after*
CompareCompareSerious Saver
$0 monthly account fee. Link to any Australian bank account.
- account fee per month
- $0.00
- Maximum rate conditions
- No withdrawals in the month. Bonus rate for first 4 months, reverting to 0.05% rate after*
- Access
- Phone banking, Internet banking
- Minimum balance
- $0.00
- Other restrictions
- -
Read our Mozo Review to learn more about the Serious Saver
Flexi Saver
Maximum rate
standard interest rate
Govt Deposit Guarantee
0.75% p.a. (for $0 to $5,000,000)0.05% p.a.(for $0 to $5,000,000)Yes up to $250,000Increase balance by at least $300 in the month
CompareCompareFlexi Saver
No upfront or ongoing fees. Unlimited free transactions. Great for regular contributions.
- account fee per month
- $0.00
- Maximum rate conditions
- Increase balance by at least $300 in the month (excluding interest)
- Access
- BPay, Branch access, Phone banking, Internet banking
- Minimum balance
- $0.00
- Other restrictions
Read our Mozo Review to learn more about the Flexi Saver
^See information about the Mozo Experts Choice Savings Accounts Awards
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