Many consumers plan to use credit cards to afford Valentine's Day. (iStock)
Under the financial strain of inflation and high prices, Americans are struggling to carve out a Valentine's Day budget despite feeling more pressure to spend more this year, a recent survey said.
Overall, Americans in relationships believe their partners expect them to spend an average of $157.52 on gifts this Valentine's Day, according to the Trustpilotsurvey. For 26% of Gen Z and 26% of millennials in relationships, meeting this expectation would mean cutting back on cost-of-living needs like gas, food and rent.
Moreover, 25% of millennials in relationships said they would consider going into credit card debt to afford gifts and experiences for the holiday. Americans now owe $1.08 trillion on their credit cards after racking up a collective $48 billion in new spending during the third quarter of 2023, according to arecent report on household debtfrom the Federal Reserve Bank of New York.
Roughly 30% of respondents in a relationship said they would not celebrate Valentine's Day because of the cost. Sadly, some Americans who forgo showing their love through gifts could pay the ultimate price for this decision. Ten percent of the partners noted that if they received no gift, they would either cancel Valentine's Day or might even break up.
"Our findings last year were eye-opening, as consumers told us they were cutting down on spending on Valentine's Day because of the cost of living crisis, and this year is no different, possibly worse," Trustpilot's Chief Customer Officer Alicia Skubick said.
One way to save on monthly bills is by shopping for a new auto insurance provider to lower your monthly premium.You can visit Credible to compare multiple car insurance providers at onceand choose the one with the best rate for you.
SOCIAL SECURITY: COLA INCREASING BUT MEDICARE COSTS RISING TOO IN 2024
This is the price of a romantic dinner
Some 52% of consumers said they planned on celebrating and expected to spend around $192 on Valentine's Day 2024, according to a driveresearch.comsurvey. This is a 9.9% increase from 2023, when the average consumer spent around $175.
It may seem generous, but the survey said that the average cost of a romantic dinner out on Valentine's is $121, with an additional $33 spent on drinks. That's not surprising since inflation for food away from home rose 5.2% over the last year, according to the most recent Consumer Price Index (CPI) released by the Bureau of Labor Statistics (BLS).
The higher cost of eating out, done at a higher frequency, means that Americans spent an average of $166 a month, per person, eating out in 2023, according to a US Foodssurvey.
If you are struggling with inflation and rising costs, one way to save money is to reduce the frequency of eating out. Another way to reduce your monthly expenses is by paying down debt. A personal loan could help you consolidate your monthly payments and pay down debt at a lower interest rate. Contact Credible to speak to a loan expert to see if this is the right option for you.
AMERICANS LIVING PAYCHECK TO PAYCHECK OWN 60% OF CREDIT CARD DEBT: SURVEY
Credit card debt likely to grow
Consumers who find Valentine's Day prices out of reach this year plan to rely on credit cards to help make ends meet. Around 3 in 10 Americans will go into credit card debt from V-day spending and 43% of them will hide it from their partner, the driveresearch.com survey said.
Consumers' growing debt burden means they have less cushion for emergencies and fewer funds to put away in savings, according to a recent Quickensurvey. Fifty-four percent of middle-class Americans and 56% of younger Americans said their current savings wouldn't last over three months if they were to lose their source of income.
It's not just middle class America feeling the impact of growing debt, according to the survey. Over one quarter (28%) of those making over $200,000 a year said their savings would last only three months if they were to lose their source of income. Financial experts recommend that consumers have roughly three to six months' worth of living expenses inemergency savings, but inflation and rising costs have made this target a challenge.
If you are struggling to pay off debt, you could consider using a personal loan to consolidate your payments at a lower interest rate, saving you money each month. You can visit Credible to find your personalized interest rate without affecting your credit score.
SECURE 2.0: OPTIONAL PROVISIONS KICK IN TO HELP RETIREMENT SAVERS WITH EMERGENCIES AND STUDENT LOAN DEBT
Have a finance-related question, but don't know who to ask? Email The Credible Money Expert atmoneyexpert@credible.comand your question might be answeredby Crediblein our Money Expert column.
