Cost of living bites into Christmas gifts

Exclusive new research shows just how hard cost of living pressures will impact on the Aussie family Christmas this year – with gifts the first to go. Vote, have your say.

Cost of living pressures are forcing many Aussies to become Christmas Grinches this year, with one in five couples curtailing the festive season by agreeing not to buy gifts.

A survey by online market research platform Toluna found two in five respondents (40 per cent) are stressed about not having enough money to buy gifts, and 19 per cent of couples are opting to forgo exchanging presents as a way to keep costs down.

Young adults have been hit especially hard, with 75 per cent of those aged under 34 saying the cost of living is forcing them to change their Christmas plans.

Most Aussies are looking to cut back on spending for Christmas gifts this year.

With Aussies paying more on their mortgages and rents, as well as rising costs for energy bills and groceries, the vast majority of respondents to the Toluna survey (83 per cent) said they will be forced to spend less on Christmas gift-giving this year. Even the minor amounts usually set aside for workplace Secret Santa are proving to be a worry, with 13 per cent of the survey respondents saying they wished they didn’t have to participate in such activities.

Toluna director Sej Patel said cost of living had been top of mind throughout 2022, “so it’s not surprising that Aussies are also feeling the pinch this Christmas”.

“Our research shows that, despite being under financial strain, the social pressures and expectations around gift-giving are making this a particularly difficult time of year, with some saying it’s dampening their Christmas spirit,” he said.

While economists think Australia’s inflationary pressures may have peaked – the rate dropped from 7.3 per cent in September to 6.9 per cent in October – the mood is even more bleak in the UK, where inflation is expected to remain at about 11 per cent for the rest of the year.

Toluna’s Head of Business for Australia and New Zealand, Sej Patel. Picture: Supplied

The overall price of food shot up a record 12.4 per cent in November, with fresh foods experiencing the biggest spike at 14.3 per cent, according to the British Retail Consortium (BRC).

“Winter looks increasingly bleak as pressures on prices continue unabated,” the BRC’s chief executive Helen Dickinson said.

“Food prices have continued to soar, especially for meat, eggs and dairy, which have been hit by rocketing energy costs, and rising costs of animal feed and transport.”

Almost half of all shoppers plan to rein in Christmas spending this year, according to research by data analysts Kantar, while the proportion of those concerned about Christmas spending has risen to 47 per cent.

“With prices still rising, the cost of Christmas will be higher this year and shoppers will be managing their budgets more closely than at any time since the start of the cost of living crisis,” head of retailer and business insight at NielsenIQ Mike Watkins said.

The UK government has offered a one-off cost of living payment of £650 ($1154) for people who claim means-tested benefits, with promises of another payment next year.