While more than a third of Canadians surveyed are cutting back, 57% are putting at least half their holiday budget toward small businesses
The countdown to the holidays is on, but this year, Canadians are reconsidering their festive spending habits. According to a new TD survey, more than one in three Canadians (36%) intend to cut back on holiday expenses this season, up significantly from 32% last year. In addition, 60% of those cutting back say that groceries and household essentials instead will account for at least half of their total spending during the holidays.
Holiday Squeeze: Canadians Get Savvy
The survey reveals that Canadians appear to be rethinking traditions and getting creative with their celebrations. Among those cutting back, two-thirds (67%) blame the higher cost of living, but 29% are prioritizing saving. Canadians are adopting a range of strategies to keep spending in check:
- 46% are cutting back on gifts for family,
- 44% are dialing down social spending, and
- 38% are scaling back on gifts for friends.
But even the best-laid plans can go awry. A staggering 77% admit they’re vulnerable to overspending, lured by flash sales, pressured to give meaningful gifts or swept up in the quest to make the holidays magical for their kids.
While only one in four Canadians (24%) have enough extra income to cover holiday expenses, others are getting resourceful by having dedicated savings for this time of year (26%), cashing in loyalty points (24%) or even taking on a side hustle (11%).
Younger Canadians appear to be feeling brighter about their holiday budgets – and are boosting them accordingly. One in four Gen Z and Millennials (25% and 24% respectively) are planning to spend more this holiday season versus 9% of Gen X and 8% of Boomers.
“The holidays may feel different this year, but Canadians are showing that festive spirit isn’t about spending big; it’s about spending smart,” said Joe Moghaziel, Vice President, Everyday Advice Journey, TD. “From creative gift-giving to leveraging loyalty points, the survey shows a shift toward intentional choices that keep celebrations meaningful without adding financial strain.”
Local Love: Small Businesses Shine Bright
Despite tighter wallets, Canadians are rallying behind local retailers. Eighty-one percent plan to support Canadian businesses this holiday season, with 57% of those shoppers putting at least half their holiday budget toward buying from local small businesses. Gen Z is leading the way, with 71% dedicating at least half their budget to local shops, compared to just 46% of Boomers.
“Every dollar spent at a local small business is a vote for your community,” said Julia Kelly, Vice President, Small Business Banking and Segment Strategy, TD. “This season, look for ways to support local retailers and artisans–whether it’s shopping at a neighbourhood market or choosing locally made gifts. Small changes in spending habits can have a big impact, both for your wallet and for the businesses that help to make your community unique.”
