Tourism survey: Younger Australians more likely to spend less this Christmas but trimmed travel still prioritised

Australians under the age of 45 are reining in Christmas spending in the midst of the cost-of-living crisis but people are still prioritising somewhat trimmed travel.

One in eight Australians aged under 45 are spending less on Christmas presents this year.

Australians under the age of 45 are reining in their Christmas spending in the midst of the cost-of-­living crisis but people are still prioritising travel to be with family and friends during the festive ­season.

Data to be released on Tuesday by the Tourism and Transport Forum reveals more than two-thirds of us (68 per cent) have altered Christmas spending choices because of budgetary pressures, with 31 per cent spending significantly less on presents and 32 per cent spending a little less.

After more than a year of interest rates on hold at 4.35 per cent, the 25-34 age group was most affected in their gift buying, with 78 per cent adjusting their spending habits compared to 76 per cent of 18 to 24-year-olds and 75 per cent of 35 to 44-year-olds.

Over 65s were the least likely to have Christmas spending affected (55 per cent), while 63 per cent of 45 to 54s and 66 per cent of 55 to 64s were curbing present buying.

Younger people were also more likely to change their travel plans because of the cost-of-living crunch, with just over half (51 per cent) saying their decisions to travel to be with family and friends at Christmas had been impacted.

TTF chief executive Margy Osmond said the changes in present buying – like families choosing to do Secret Santa rather than purchasing individual presents for family members – was also evident in travel and holiday trends.

“How many families are doing Secret Santa instead of the ‘pressie bomb’ when there’s a sea of wrapping paper on Christmas morning? That’s the same thing we’re seeing in the holiday space, they’re absolutely not giving up the right to have a holiday but they are trimming,” Ms Osmond told The Australian.

“They’re potentially staying closer to home, they’re taking slightly less time off, they’re maybe staying at potentially not quite as an expensive destination as they may have otherwise, and there’s a lot of getting to know your relatives better.

“We’re still seeing 14 to 15 per cent of people going overseas but we’re seeing the same kind of trimming there too. When you think about the industries that will be significantly affected over the next 12 to 18 months, it’ll be the discretionary spend sectors like travel and retail.”

While Australians are spending less on gifts, holidays and travel ranked as the No 1 non-essential expense over Christmas (26 per cent this year compared to 25 per cent last year), followed by personal care and special occasion presents (17 per cent), streaming services and dining out (9 per cent) and new clothes and food delivery (6 per cent).

That compared to 39 per cent of Australians overall saying cost of living hadn’t changed their decision to travel, including 38 per cent of those aged over 45.

A quarter of people will stay home as a result of their budgets, 19 per cent will spend less time away and 44 per cent said cost of living had impacted travel plans.

Ms Osmond said while Australians had been focused on paying their mortgage, rent and buying food and clothes, there was a whole range of discretionary spend businesses and sectors that were going to feel the pain as people were more careful with money.

“When you ask people what their favourite thing to do when they go on holidays, a very sizeable proportion say shop,” Ms Osmond said.

“People have to buy groceries and they’ll keep doing that.

“But travel, personal care, gifts for birthdays, weddings, special occasions, little treats for yourself, you push that out into the fashion industry, tourism sector across the board, hospitality, even small take- aways will feel the pain significantly now.”