Holiday shoppers to spend more without adding debt

Overall holiday spending is on the rise in 2013, but the money isn’t going to gifts, says the RBC Canadian Consumer Outlook.

Holiday costs are expected to increase slightly to $1,192.50 from $1,181.80 last year. But amount going towards gifts has actually dropped. Shoppers’ typical budgets are down for a second year, from $628.50 in 2012 to $608.60.

Read: Retailers spirit away an extra 3.5%

But Canadians intend to spend more in other areas, like decorations, entertainment and travel, at $583 versus $553.

A recent RBC Economics report notes that Canadian households’ non-mortgage debt grew at the slowest annual pace for 10 years in the 12 months ending September 2013.

Similarly, 54% of Canadians intend to cover their holiday expenses using cash or debit cards (compared to 56% last year), while 25% intend to pay with a credit card, but say they will pay it off in full within the next billing cycle. Only 6% intend to carry a balance on their credit card.

Read: Buy gifts online to save cash

Intentions vary across the country. British Columbians are making the most significant cutbacks, while those in Atlantic Canada are outspending most other regions this season.

Biggest holiday spenders in 2013: