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You’ve probably heard that consumers are stressed about spending too much for the holidays, but have you heard about spending too much because of that stress?
All right, let us explain. A new report from Intuit Credit Karma found that while 96% of more than 1,000 US adults surveyed are worried about the economy, 27% are “doom spending,” aka buying despite economic challenges to cope with stress.
In fact, a third (32%) of shoppers in the US have taken on debt in the past six months because of increased spending, especially among millennials and Gen X, the report noted.
The doom spending phenomenon is more frequent among younger consumers, affecting 35% of Gen Z and 43% of millennials.
And while debt levels continue to rise, doom spending has also impacted American consumers’ savings. Almost half (47%) of Americans have noticed a decrease in their savings over the past six months, while 52% said they had less than $2,000 in savings and one in five didn’t have any at all.“
Much like doom scrolling, we’re seeing people mindlessly shop to soothe concerns about the economy and foreign affairs, which could take a toll on their financial well being,” Courtney Alev, consumer financial advocate at Credit Karma, noted in the report.
“According to Adobe Analytics’ recent pre-holiday spending report, consumers spent a record $76.8 billion shopping online between October 1 and October 31,” a 5.9% YoY increase, Retail Brew previously reported.