{"id":10030,"date":"2021-12-09T18:02:05","date_gmt":"2021-12-09T18:02:05","guid":{"rendered":"https:\/\/zackspcg.com\/blog\/?p=10030"},"modified":"2022-02-26T13:05:37","modified_gmt":"2022-02-26T13:05:37","slug":"is-inflation-pushing-up-holiday-spending-numbers","status":"publish","type":"post","link":"https:\/\/zacksim.com\/blog\/is-inflation-pushing-up-holiday-spending-numbers\/","title":{"rendered":"Is Inflation Pushing Up Holiday Spending Numbers?"},"content":{"rendered":"\n<p><em>Chad L. from Virginia\nBeach, VA asks: <\/em>Hello Mitch, I\u2019ve read in a few places that holiday\nshopping is expected to be strong this year, but isn\u2019t it also true that people\nare spending more because prices are higher? In other words, is higher spending\njust tied to inflation, and therefore not as meaningful?<\/p>\n\n\n\n<p><strong>Mitch\u2019s Response:<\/strong><\/p>\n\n\n\n<p>Thank you for emailing your question\u2013 it\u2019s a really smart\ntake on the holiday spending data. <\/p>\n\n\n\n<p>The short answer is that numbers are actually up across the\nboard \u2013 wages are higher, spending is higher, and inflation is higher as well.\nEvery person in the economy\u2019s experience is different. But on a macro level,\nthe rate of increase across the three metrics signals that inflation is not\ndisproportionately resulting in higher holiday shopping figures. Inflation is\ncontributing, but the strong year-over-year numbers are also a result of more\nengaged consumers. Despite all the challenges brought by the pandemic, labor\nshortages, and some inventory issues, consumers have increased spending by about\n4.4% on average over the last five years.<sup>1<\/sup><\/p>\n\n\n\n<hr class=\"wp-block-separator\"\/>\n\n\n\n<p><strong><a href=\"https:\/\/go.steadyinvestor.com\/retirement-uncertainties-guide?source=zim&amp;medium=email&amp;term=mitchsmailbox_zim_2021_12_08&amp;content=retirement_uncertainies_guide\">Common Retirement Uncertainties and How to Prepare for Them!<\/a><\/strong><a href=\"https:\/\/go.steadyinvestor.com\/retirement-uncertainties-guide?source=zim&amp;medium=email&amp;term=mitchsmailbox_zim_2021_12_08&amp;content=retirement_uncertainies_guide\"><br><\/a> \u00a0<br><strong>What if the market crashes or a medical emergency arises?<\/strong>\u00a0There are so many unknowns that come with planning your retirement, but there are simple steps you can take NOW to help ensure your secure and comfortable retirement.<br> \u00a0<br>Get our practical advice that is based on decades of experience and can potentially guard your retirement assets against the \u201cwhat ifs\u201d in life, including:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>How to counteract the effects of rising inflation<\/li><li>Ideas to allocate your assets to defend against a correction or crash<\/li><li>Strategies to deal with financial emergencies without liquidating investments<\/li><li>Tax planning ideas to help avoid unpleasant surprises<\/li><li>Plus, more ways to help protect yourself and your family against retirement unknowns<\/li><\/ul>\n\n\n\n<p>If you have $500,000 or more to invest,\u00a0<strong><a href=\"https:\/\/go.steadyinvestor.com\/retirement-uncertainties-guide?source=zim&amp;medium=email&amp;term=mitchsmailbox_zim_2021_12_08&amp;content=retirement_uncertainies_guide\"><em>download our\u00a0Retirement Uncertainties\u2026and How to Breeze Through<\/em><\/a><em>.<\/em><sup>2<\/sup><\/strong><\/p>\n\n\n\n<hr class=\"wp-block-separator\"\/>\n\n\n\n<p>RetailNext, a research firm that tracks in-store shoppers,\nsaid that foot traffic in stores was up 61% this Black Friday compared to 2020,\nwhen many consumers were still skittish about the spread of Covid-19.\nInterestingly, consumer enthusiasm to get out and shop did not affect online\nsales all that much \u2013 e-commerce on the holiday weekend posted $9 billion in\n2020 to $8.9 billion in 2021.<\/p>\n\n\n\n<p>To be fair, Black Friday store shopping was still down about\n25% from 2019 levels, before the pandemic struck. But overall, the National\nRetail Federation expects that U.S. November-December retail sales will jump by\napproximately 10% from a year ago, bringing the total to as much as $850\nbillion or more. Compare that 10% figure to inflation \u2013 according to the Labor\nDepartment, the consumer price index (which roughly measures what consumers\nspend on a basket of goods and services) jumped by 6.2% in October from the\nprevious year. <\/p>\n\n\n\n<p>Consumers generally seem to be aware (and put off by)\ninflationary pressures, but it is not deterring them from getting out and\nspending. According to a survey conducted by Deloitte, 70% of people started\nholiday shopping before Halloween, likely because they were worried about\ninventory\/supply chain problems. That\u2019s up from 66% in 2020 and 61% in 2019.\nDeloitte also asked consumers if they would be spending more this holiday\nseason, to which about one-third said yes. Most of those consumers were\nspending more because their financial situation had improved \u2013 not necessarily\nbecause of inflation. <\/p>\n\n\n\n<p>At the end of the day, it is not a perfect science determining\nwhether inflation is the primary driver of higher holiday spending, or whether\nit is consumers\u2019 strong financial position pushing the figures higher. Either\nway, spending is up and major retailers are expecting to post record profits \u2013\nwhich is ultimately what matters most to investors, in my view.&nbsp; <\/p>\n\n\n\n<p>Holiday spending and inflation will affect the\nmarket \u2013 but what does this mean for investors who are preparing for\nretirement? This is the perfect example of why we cannot predict exactly how\nthese situations will pan out. No matter how carefully you prepare for\nretirement, life\u2019s unknowns can throw your plans off track.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li><strong>The effects of inflation could diminish the real value of your nest egg<\/strong><\/li><li><strong>A stock market correction or crash may cause your net worth to plummet<\/strong><\/li><li><strong>Changes in your situation\u2014such as a health emergency\u2014could have an enormous impact on your nest egg<\/strong><\/li><\/ul>\n\n\n\n<p>But you can take steps to prepare yourself and help protect your secure and comfortable retirement.<br> \u00a0<br>If you have $500,000 or more to invest, get our free guide,\u00a0<strong><a href=\"https:\/\/go.steadyinvestor.com\/retirement-uncertainties-guide?source=zim&amp;medium=email&amp;term=mitchsmailbox_zim_2021_12_08&amp;content=retirement_uncertainies_guide\">Retirement Uncertainties\u2026and How to Breeze Through Them.<\/a><sup><a href=\"https:\/\/go.steadyinvestor.com\/retirement-uncertainties-guide?source=zim&amp;medium=email&amp;term=mitchsmailbox_zim_2021_12_08&amp;content=retirement_uncertainies_guide\">3<\/a><\/sup><\/strong>\u00a0It provides advice, based on our decades of experience, that we believe can help ensure that your golden years will be comfortable and secure.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Holiday spending expected to be up around 10% this year, but is the rise simply due to higher prices?<\/p>\n","protected":false},"author":3,"featured_media":7436,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[66,71],"tags":[],"class_list":["post-10030","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-mitchs-mailbox","category-private-client-group"],"acf":[],"_links":{"self":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/10030","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/comments?post=10030"}],"version-history":[{"count":1,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/10030\/revisions"}],"predecessor-version":[{"id":10244,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/posts\/10030\/revisions\/10244"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/media?parent=10030"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/categories?post=10030"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/zacksim.com\/blog\/wp-json\/wp\/v2\/tags?post=10030"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}