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06/11/2021

More Americans Willing to Take on Debt for Post-Pandemic Shopping

As consumers gain confidence coming out of the COVID-19 pandemic, more Americans are willing to shell out and go into debt to enjoy themselves.
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As consumers gain confidence coming out of the COVID-19 pandemic, more Americans are willing to shell out and go into debt to enjoy themselves. 

According to a new survey from CreditCards.com, 44% of U.S. adults said they are willing to take on debt to “treat themselves,” Chain Store Age reported. The top three areas where Americans said they would take on debt include automotive (15%), home renovations (14%) and travel (12%). 

Executive Summary

The survey comes just after the National Retail Federation raised its outlook for the year based on a high rate of consumer spending. For the rest of 2021, retail sales are projected to soar between 10.5% and 13.5% to reach $4.44 trillion. However, a significant portion of survey respondents (66%) said they will treat themselves to celebrate the pandemic winding down even if they don’t have a plan to pay for it.

 

“After putting up with COVID for more than a year, I think everyone is entitled to treat themselves,” said Ted Rossman, senior industry analyst for CreditCards.com. “However, I’m concerned that so many people are willing to go into debt as a result. Credit card rates have been creeping up, and they generally range from about 16% to 24%. That’s really expensive debt.”

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Exec summary

After being cooped up at home for more than a year, consumers are also ready to splurge on experiences outside the home as well as inside the home, including  travel (35%), out-of-home entertainment (26%), bars and restaurants (26%), home renovations (25%) and clothing and accessories (21%).

The majority of those willing to take on debt for post-pandemic purchases were younger--59% were millennials, 56% were Gen Zers, 40% were Gen Xers and 32% were baby boomers in the survey.


See the full story at Chain Store Age.