How are people paying for holiday gifts? 21% are counting on a bonus from work [Survey 2021]

Money concerns are the biggest cause of anxiety for holiday shoppers this year.

christmas shopping at computer
Updated May 13, 2024
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Holiday shopping in 2021 will look different from years past. Last year, COVID-19 worries drove more shoppers online, a trend likely to continue this year. But this year, shoppers also need to contend with massive supply chain disruptions that are affecting products from wine to automobiles and worker shortages that could lead to longer lines and shorter shopping hours.

FinanceBuzz surveyed 1,200 U.S. adults to better understand what holiday shopping will look like in 2021.

Key findings 

  • 60% of shoppers say they'll "definitely" or "probably" start their holiday shopping earlier than normal this year because of possible supply chain disruptions.
  • Men are more likely than women to have a budget for their holiday shopping — 69% of men and 43% of women have or will have a budget for gift giving.
  • People are looking at different ways to pad their bank account this holiday season: 28% are planning on extra income from a side hustle, 21% are counting on a bonus from work, and 13% plan to borrow money from family or friends.
  • Shoppers are split on whether they'll take advantage of pay-over-time services like Affirm or Klarna at checkouts this year — 23% said they'll "definitely" consider using one, while 21% said they'll "definitely not" be buying now and paying later.
  • The biggest worry people have around gift-giving is not knowing what to buy. More than 1 in 3 (37%) cited this as a concern. It topped other worries like having enough money to buy everything they want (35%), being unable to get gifts in time or being unable to find gifts in stock (both 30%), and overspending (27%).

Supply chain issues lead to holiday worries

Last holiday season, "supply chain" was a term limited to warehouses and retail headquarters. This year the supply chain is a topic of conversation at dinner tables as consumers see empty shelves and backed-up cargo ships.

These supply chain concerns mean shoppers will be getting an early start. A whopping 60% of shoppers say they'll "definitely" or "probably" start their holiday shopping earlier than normal this year because of concerns about products being out of stock.

supply chain worries lead to early shopping


Broken supply chains aren't the only thing causing shoppers worry this year. Concerns around money are causing anxiety for 42% of people, and COVID-19 is anxiety-inducing for 35%. Other sources of holiday anxiety include having too much to do (33%), crowds (31%), and family (28%).

causes of holiday anxiety


Budgets are popular this year, especially with men

One way to tackle money worries head-on is to create a budget and stick to it. In all, 57% of Americans have a budget for their holiday shopping, and another 27% plan to have one. Only 16% are heading to the stores (or to the internet) without a budget in mind.

Looking deeper, it appears that men are much more likely than women to approach their shopping list with a budget in mind. Sixty-nine percent of men reported having a budget already vs. 43% of women who said the same.

men vs women holiday budget


We asked those who have a budget or plan to have one whether they're likely to stick to the budget. More than three-quarters of budgeters say they are "extremely likely" or "somewhat likely" to stick to their budget. Less than 4% said they're "extremely unlikely" to stay on budget.

how likely to stick to budget


With so many budgeting for their holiday shopping, It's not surprising to learn that many have also saved up money to pay for gifts. In fact, more than half of the people — 52% — say they'll use money they've saved to pay for holiday gifts.

Some anticipate needing some extra money to cover their spending — 28% are planning on extra income from a side hustle, 21% are counting on a bonus from work, and 13% plan to borrow money from family or friends. Another 13% say they will be opening a new credit card this holiday season.

how people will pay for holiday gifts

Buy now, pay later?

Layaway has long been an option for paying for holiday purchases over time. In 2021, shoppers are likely to encounter a new, high-tech version of layaway when they checkout. Companies like Affirm, Sezzle, Klarna, and Afterpay have flipped the layaway concept on its head by offering their pay-over-time services. Instead of making you wait until you pay off your purchase, these services allow customers to take their item home today, then pay it off over time.

Many popular retailers are offering buy now, pay later options this year, including Target, Walmart.com, and Old Navy.

Our survey found that shoppers are split on whether they'll take advantage of pay-over-time services this holiday season — 23% said they'll "definitely" consider using one, while 21% said they'll "definitely not" be buying now and paying later.

pay over time consideration


Another popular way to finance holiday purchases is to put purchases on a credit card that offers a 0% interest rate. These cards typically offer this interest-free financing for a limited time after card opening (typically 9-18 months). During this time, the cardholder makes payments on their debt without accumulating interest. A missed payment usually ends the interest-free period, so it's important to make regular monthly payments when using this financing option. 

We found shoppers are more likely to take advantage of 0% APR credit cards versus using a pay-over-time service. Twenty-eight percent of people said they'd "definitely consider using a 0% card and only 16% said they'd "definitely not" use one.

using 0 percent interest credit card for holiday purchases


It's not just how to buy, it's what to buy that causes anxiety

Even when you've got a budget and payment method nailed down, there's still the question of what to buy. Our survey found that not knowing what to get the people on their holiday list is the biggest worry people have when it comes to gift giving, with 37% saying it's a concern. It topped other worries like having enough money to buy everything they want (35%), being unable to get gifts in time or being unable to find gifts in stock (both 30%), and overspending (27%).

Disappointing loved ones with their holiday gifting is also a concern for many. Twenty-three percent are worried they'll disappoint their significant other, and 21% are worried about disappointing their kids.

gift giving worries


For those fretting over gifts, here's a stat to consider. Receiving several small gifts is favored over receiving one big gift — 44% want multiple small gifts while 25% prefer one big gift.

prefer one big gift or several small gifts


Gift cards or cash are a common go-to when you don't know what to buy someone. We found people are split here on what they'd prefer to receive. When given a choice between a gift card, physical gift, or cash, 30% want the gift card, 25% the physical gift, 24% want cash, and 21% don't have a preference.

gift cards or cash


Bottom Line

While the holidays are painted as a time for joy, the reality is that they are a big source of worry and anxiety for many. Supply chain disruptions are a new worry to add to the list in addition to more traditional concerns like money and not knowing what to buy. Luckily most Americans have a budget and payment strategy in mind as they tackle their shopping, two tools that should reduce worry and help prevent overspending this year.

Methodology

FinanceBuzz surveyed 1,200 U.S. adults ages 18 or older, who comprise a nationally representative sample, on October 13, 2021.

Author Details

Tracy Odell

Tracy leads the editorial team at FinanceBuzz. Prior to joining the company in 2019, Tracy held leadership roles at Student Loan Hero, LendingTree, Meredith Corporation, and CafeMedia. She has over 20 years of content and brand experience across the personal finance, lifestyle, and parenting verticals.