One in three gifted more cash to loved ones last Christmas than they did the year before, despite 40% scaling back overall Christmas spending.
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A survey of more than 2,600 customers carried out by Paragon Bank found that 37% of savers were more likely to choose to gift money to friends and family this year compared to last.
Due to the current lockdown restrictions, experiences were the least popular gift option, with 82% agreeing they shied away from giving presents such as spa breaks or gig tickets.
Gift vouchers also decreased in popularity, with 44% of savers more reluctant to gift those than before, reflective of the current economic uncertainty and the perceived impact of the pandemic on the retail sector.
This increase in cash gifting is despite four in ten Paragon savers scaling back spending on festivities during the pandemic, with 75% of those naming pandemic restrictions as the main reason for having a cheaper Christmas.
Nearly one in four said they wanted to focus on smaller, thoughtful gifts for loved ones, while 43% of savers agreed that they saved money by spending less in the run-up to Christmas.
The biggest festive spending cuts were among millennial age groups, with 74% of 25-29 year olds and 57% of 30-39 year olds opting for cheaper festivities in 2020.
Amongst the 16% of those surveyed that opted to spend more last Christmas than they did the year before, nearly half (45%) hiked up costs by choosing to gift more expensive gifts than usual, while one in three (31%) utilised some savings made during the pandemic to boost their festive budget.
Christmas shopping trends
One of the emerging trends noted last Christmas was around supporting small businesses. Amongst those surveyed, 41% either focused on buying local products to support their communities or on buying from small independents.
Unsurprisingly, most shoppers also turned to online banking in order to do their Christmas shopping safely, with 81% of people surveyed choosing to do more or most of their shopping online. One in four also opted to do their food shop online, whereas they would usually visit a supermarket.
Derek Sprawling, Savings Director at Paragon Bank, said:
“The findings of our survey show that the lockdown restrictions, combined with the current economic climate, had a significant impact on people’s Christmas plans, which was reflected in lower Christmas spending than in previous years.
“We saw savers in younger age groups make the biggest cuts over Christmas, which is reflective that those demographics have been the most financially impacted by the pandemic.
“As we continue the third national lockdown, we anticipate that the saving trends noted throughout the pandemic will continue to be prevalent at least until the restrictions start to lift, with people putting pandemic savings aside and topping up their rainy day funds.”
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