Saving is the order of the day

180,000 households have no money for presents

Not every Christmas tree contains (monetary) gifts.

(Bild: L. Drechsel - stock.adobe.com)

Christmas is just around the corner and many families are looking forward to it. But even though Austrians on average want to spend more money on presents this year, many people have to save money. Almost 180,000 households are not planning any presents at all under the Christmas tree this year.

Recently, it has been reported time and again that Austrians want to spend more on Christmas this year than last year. Retailers also reported very pleasing sales trends on the first three shopping Saturdays. In view of the high inflation in recent years, which has made electricity, gas and food, for example, much more expensive, one wonders how this fits together. The answer in a nutshell: wealthier people are spending significantly more on gifts this year, while poorer households are spending significantly less.

"Forecasts for the 2024 Christmas season usually only show 'half the truth' with average values. This is because the gap between the lowest-income and highest-income households is particularly evident in the run-up to Christmas. While households in the lower income quartile continue to suffer from the after-effects of the inflation crisis and (have to) save on their Christmas shopping or skip it altogether, the top income quartile spends more than ever on Christmas presents," summarizes Ernst Gittenberger from the Institute of Retail, Sales and Marketing (IHaM) at the Johannes Kepler University Linz (JKU).

The gap between the lowest-income and highest-income households is particularly evident in the run-up to Christmas.

Ernst Gittenberger vom Institut für Handel, Absatz und Marketing (IHaM) der JKU Linz

Households in the lowest income quartile are particularly likely to hit the spending brakes. Around a quarter of households in Germany have to make do with a monthly net household income of less than 2,000 euros. In this group, 17% state that they will not be buying any Christmas presents at all this year. In absolute figures, this corresponds to just under 180,000 households. This group includes an above-average number of single households, unemployed people, young people and pensioners.

And if lower-income people do buy presents, they spend significantly less per household than the average at EUR 290 (2023: EUR 320). 21% of low-income earners emphasize that they are increasingly turning to online stores because it is cheaper there than in stores.

(Bild: Krone KREATIV)

"We see that many low-income households are (having to) save this year or are turning to low-cost platforms such as Temu. These changes in behaviour are not so much conscious decisions as adjustments to limited financial resources," emphasizes Christoph Teller, Director of the Institute for Retail, Sales and Marketing (IHaM).

We can see that many low-income households are (having to) save this year or are resorting to low-cost platforms such as Temu

Prof. Christoph Teller, Institutsvorstand des Instituts für Handel, Absatz und Marketing

Bild: Horst Einöder/Flashpictures

The "rich" will naturally dig much deeper into their pockets for December 24. The top income decile (net household income over EUR 500 per month) spends an average of EUR 920 (2023: EUR 900), more than three times as much as the lowest income quarter.

Almost half of Christmas sales from the wealthy
The financial strength is also reflected in the distribution of the total sales pie. Austrians are likely to spend around 2.23 billion euros on Christmas presents this year. 43 percent of this (950 million euros) will be spent by the wealthiest 25 percent, but only 13 percent (300 million euros) by the lowest income quarter.