As the holiday season approaches, many of us are preparing to celebrate in the middle of a complex financial landscape. According to our sixth annual Summer Spending Survey, R224 billion in spending is expected during this festive season, representing a 4.4% decline from the previous year.
Despite this slight dip in overall spending, the average budget allocated for extra festive season expenses stands at R5,707 per person. Notably, 40% of South Africans express an improved financial outlook compared to the previous year, underscoring a positive trend in economic well-being.
We understand that financial well-being intertwines with mental well-being. As we navigate our holiday plans, we see the conscious effort to balance necessities and luxuries. This year, a significant 68% of South Africans expressed a preference for gifts that can assist with everyday expenses, indicating a pragmatic shift in consumer priorities.
The Summer Spending Survey Sheds Light on the Evolving Dynamics of our Festive Spending
Food and Beverage Spend in the Festive Season
Food and beverages continue to dominate expenses, constituting over 33% of this year's festive season budget. However, this is coupled with a growing awareness among many of us about prioritising necessities over luxuries as households grapple with the increasing cost of living.
This Year in Gifting
Gifting preferences reflect a similar sentiment, with money and shopping vouchers topping the wish list for 68% of us. Notably, 15% express a desire for grocery vouchers, emphasising the significance of practical gifts in times of economic uncertainty.
A Notable Shift in Travel
Travel plans are undergoing a notable shift, with only 21% indicating travel during the festive period—the lowest proportion since our survey's inception in 2018.
Affordability as a Rising Key Factor
Affordability emerges as a key factor, with 48% of non-travellers citing financial constraints as the primary reason. The impact of fuel price hikes and the high cost of living contribute to this trend.
Budgeting and Spending
The reliance on savings has decreased, with only 37% planning to use savings for festive expenses, down from 40% in the previous year. Instead, 44% of South Africans anticipate a year-end bonus, a substantial portion of which will be allocated to cover additional holiday expenses.
The use of Credit and Loans
A nuanced reliance on credit cards and loans has increased from 27% to 32%, highlighting the impact of inflation on spending habits.
Trends in Shopping
Shopping trends showcase a diverse landscape, with online shopping plateauing at 26%. In-store shopping remains a dominant choice, favored by the majority, while a notable 10% of us explore markets for unique gifts. A creative 6% express an intention to craft our own gifts at home.
End of Year Celebrations
The celebration of the festive period takes various forms, with a home braai leading the way (47%). The beach, restaurants, and cafes also feature prominently, reflecting the diversity of South African holiday traditions.
Ubuntu
Notably, 11% of South Africans express a commitment to the spirit of Ubuntu by donating money or volunteering time to charity.
The Year Ahead
Looking ahead, our survey indicates mixed sentiments about the coming year. While over half of us express optimism and excitement for 2024, nearly a third acknowledge feelings of anxiety or fear. This mixed outlook reflects the challenges faced by many households in the past year, further emphasising the need for financial prudence amidst a changing economic landscape.
