Many Aussies will spend more than you think on Christmas!

With the annual Christmas shopping rush is now in full swing, alarming results from a new survey by Australia’s leading financial comparison website (RateCity) show that more than half (51 percent) of Australians will be relying on their credit cards to purchase presents this year.trans

The 2012 RateCity Christmas Shopping Survey, which questioned more than 1000 Australian adults, found Australians will spend an estimated $8.5 billion on Christmas presents. Adults are expected to spend $511 each on average, with children receiving an average of $87 worth of gifts per adult on December 25.

Australians aged between 35 and 44 are the most reliant on plastic, with 65 percent planning to use their credit cards to cover Christmas presents.

What’s more concerning is about one in 10 credit card users (11 percent) plan to make minimum repayments to pay off their Christmas debt. While those aged between 25 and 34 are more likely to make minimum repayments than other age groups (18 percent).

But it’s Generation Y, the 18-24 year-olds, who feel the biggest financial burden at Christmas, with almost half (43 percent) feeling pressured to spend more money than they can afford on Christmas presents. This is compared to about one-third (31 percent) of all respondents feeling pressured to spend more at Christmas.

The Baby Boomers aged 65+ are most responsible with their credit cards according to the RateCity survey, with the majority (92 percent) planning to pay back their debt during the interest-free period. In contrast, Generation Y are the least likely to pay back their debt during the interest-free period out of all age groups.

RATECITY CHRISTMAS SHOPPING SURVEY national spending highlights

Total spend on Christmas presents

$8.5 billion

How much on average each adult plans to spend


How much on average each adult plans to spend per child


Proportion of Australians who feel pressured to spend more than they can afford


Proportion of Australians who plan to use credit cards for Christmas presents


Michelle Hutchison, Spokesperson for RateCity, said Australians could end up spending a lot more money on Christmas presents than necessary by not using credit cards wisely.

“Australians need to be careful with using credit cards to pay for Christmas presents because if you’re not prepared for how to pay back the debt, it could cost significantly more than planned.

“More than half of Australians are expected to spend $4.3 billion on their credit cards to pay for Christmas presents according to the 2012 RateCity Christmas Shopping Survey.

“While it’s great to see the majority (81 percent) of card users are planning to pay back their debts during the interest-free period, 6 percent of these card users don’t know how they will pay back their debt, which is double the proportion who are planning to use a balance transfer card to help pay it back (3 percent).”

According to RateCity, by paying back the average Christmas shopping credit card debt of $511, it would take almost three years to pay back the debt and cost $129 in interest (using the average minimum repayment of 2.5 percent or $20 and average purchase rate of 17 percent).

“Christmas shopping can ruin your financial outcomes for the following year so if you’re planning to use a credit card, make sure you’re armed with a great value card and then make a plan on how you will pay back the debt after the festive season,” said Mrs Hutchison.

RATECITY CHRISTMAS SHOPPING SURVEY national credit card highlights

Of the 51% of Australians planning to use credit cards for Christmas purchases…

Planning to pay off balance during interest-free period


Planning to make minimum repayments


Planning to use a balance transfer credit card


Don’t know how they will pay back their credit card debt


Total interest charged on $511 debt making minimum repayments


How long it will take to pay off credit card debt of $511 making min. repayments

2 years and 9 months

Credit card users across 5 states

The 2012 RateCity Christmas Shopping Survey showed that Victorians will be giving their credit cards the biggest workout this Christmas, with 57 percent of respondents from Victoria planning to use plastic to cover costs. Western Australians will be using their cards the least out of the states surveyed (42 percent).

More South Australians will struggle to pay off their cards after Christmas, with 19 percent planning to make minimum repayments, compared to 2 percent of card users in WA. However, about one in 10 card users in WA (9 percent) don’t know how they will pay back their debt.

South Australians feel the most pressure to spend more money on Christmas presents, with 36 percent feeling the heat of Christmas expenses.



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Michael is a director of Metropole Property Strategists who help their clients grow, protect and pass on their wealth through independent, unbiased property advice and advocacy. He's once again been voted Australia's leading property investment adviser and one of Australia's 50 most influential Thought Leaders. His opinions are regularly featured in the media. Visit

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