Here's What the Average American Will Spend on the Holidays This Year

A couple shops online with a credit card during the holiday season

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Key points

  • U.S. consumers are expected to spend more money this year than last.
  • Consumers can avoid debt in the course of their holiday purchases by setting a budget, shopping early, working a side hustle, and using the right credit cards.

It's not uncommon to spend a big chunk of money during the holidays, and a new survey from Deloitte reveals just how much consumers plan to plunk down this year.

The average American will spend $1,463 this year on holiday shopping. That's a 5% increase from 2020.

Given that supply chain issues and inflation are causing the cost of many goods and products to rise, that higher number isn't surprising. Also, with a more stable economy, a lot of people are in a better place financially this holiday season than they were last season and may therefore feel comfortable spending more.

Still, no matter what you're planning to spend on the 2021 holidays, it's important you do your best to avoid closing out the season with a pile of debt. These key moves could help you do just that.

1. Set a budget

It's important to approach your holiday shopping with a budget in mind, rather than simply go out, purchase items, and hope you can pay for them without having to carry a credit card balance. You might think a little holiday debt is worth it for a chance to shower your loved ones with gifts, but debt can be stressful, and it's something you'd probably rather avoid going into the new year.

Before you shop, take a look at your different sources of cash for holiday spending purposes. It may be that you have access to $300 from your upcoming paychecks, plus another $1,000 in savings that you've set aside during the year. Use those figures to establish a spending limit, and from there, set priorities so you're able to buy all of the things you want and need without going over it.

2. Shop in advance

This year, a lot of stores are expecting to be low on inventory during the holidays because of supply chain issues and shipping delays. It’s important to do as much shopping in advance as you can. That way, you'll not only have an opportunity to seek out good deals, but you'll also be less likely to miss out on the things your loved ones really want.

3. Get a side job

If you have big spending plans this holiday season, it could really help to get a side hustle. Even if you only have a few hours a week to drive for a ride-hailing service, pet-sit, or tutor, that extra cash could spell the difference between racking up debt and covering all of your costs.

Furthermore, you may be able to find a side job at a local retailer that offers not only a decent hourly wage, but an employee discount. That could make your holiday purchases even easier to swing.

4. Use the right credit cards

The more cash back you're able to get from your credit cards, the more manageable your holiday purchases will be. Take a look at your existing cards and use them strategically. It may be that one card is offering bonus cash back at department stores or specific retailers this quarter, allowing you to reap more rewards.

It could also pay to apply for a new credit card with a sign-up bonus. Say there's an offer of $200 cash back for spending $1,500 within three months of opening your card. If you intend to spend $1,463 on holiday purchases like the average consumer, that should be a pretty easy threshold to meet.

Whether you plan to spend more than the typical consumer this year, less, or about the same, it's really important to try to steer clear of debt. If you stick to a budget, shop ahead of time, score more spending cash with a side job, and maximize your credit card rewards, you'll put yourself in a stronger position to buy the things you want and need without hurting your finances in the process.

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