SunLive – Jingle bills and pressure on household spending

Interest rates may be set to fall further, but most New Zealanders are feeling the burden of other household expenses ahead of this year’s festive season as holiday spending plans remain at the same level as in 2023.

Latest consumer survey of over 1000 New Zealanders conducted MIOBshows that the cost of food/supermarket (70 percent), utilities (45 percent) and insurance (36 percent) are the top three pressures on household budgets.

While 30 per cent are feeling the heat from rent prices and almost a quarter say their mortgage is putting pressure on their budget, another fall in the official cash rate (OCR) this week is unlikely to lead to significant extra spending in the run-up to Christmas.

Sixty percent of those surveyed said the OCR cut would not impact their holiday season budget, but one in 10 said their spending would increase and 16 percent were unsure if they would change their spending. plans or not.

“It’s understandable that many Kiwi consumers will feel like this is a repeat of last year as the silly season begins in 2024,” MYOB chief customer officer Dean Chadwick said.

“The wallet remains relatively tight as costs continue to bite, and consequently the majority of New Zealand shoppers (61 percent) are experiencing some degree of stress or worry about their finances for the festive season.

“Despite continued consumer caution, our data shows that overall intentions to spend money on essential holiday purchases, such as gifts or food and drink, remain relatively high.”

Spending plans, shopping strategies and inventory surprises are revealed.

In terms of how New Zealanders are likely to spend their festive season budgets, the MYOB survey shows Kiwi shoppers estimate they will spend an average of $468 on food and drink, 10 per cent less ($47) than the average last year – a potential gain after inflation fell over the past 12 months.

When it comes to gifts, respondents plan to spend an average of about $163 per person, but 50 percent plan to spend less than $100 per person. Encouragingly, for the majority of New Zealanders (56 percent), the amount they expect to spend on gifts is the same as last year, while almost a quarter (24 percent) say they will spend less.

So, what gifts will families and friends be exchanging this year? Clothing and footwear remain top of the list (41 percent), followed by gift cards or vouchers (38 percent), food and drink (34 percent), toys (32 percent) and money cards or cash (24 percent). .

“While a small proportion of New Zealanders have already done all their holiday shopping, foot traffic around local stores is likely to increase this month, with almost a quarter of those we surveyed planning to do the majority of their holiday shopping somewhere. in November and just over one in 10 plan to spend more on Black Friday,” Chadwick said.

“However, there is certainly no big break in the tradition of last-minute rushes. With a quarter of those surveyed delaying shopping until December, retailers could see the festive boost continue with footfalls still to come.”

In terms of where the tills will be ringing the most, businesses in local shopping centers are again likely to see the most footfall as 39 per cent of New Zealanders flock to retail shopping centers to buy the bulk of their gifts, and nearly one in five will be keen to Buy from local New Zealand businesses for the majority of your purchases.

Overall, traditional brick-and-mortar stores are holding their own, with only 14 percent of respondents planning to do most of their shopping online, but trading can be challenging for department stores, with just 5 percent of respondents planning to do most of their shopping online. gifts from one of these sellers.

“The end of the year is a key trading period for many local businesses as consumers prepare for the holiday season and retailers are an important part of that tradition. For those who haven’t done their Christmas shopping yet, now is a great time to think about shopping local and supporting SMEs in communities across the country. This could ensure everyone has a Merry Christmas.”