Canadians show shopping restraint on Black Friday and Cyber Monday, but many report substantial overspending

Small Business Canada
  • 60 per cent of Canadian shoppers surveyed say they stayed true to budget on Black Friday and Cyber Monday – but one in four say they overspent significantly (more than $250 on average)
  • On average, Canadians expect to carry more than $800 in additional credit debt into the new year — $1,200 for Canadians 18-34 
  • Shoppers on the Prairies prove to be the best on a budget, while Albertans most likely to say they blew past their budgets on Black Friday and Cyber Monday spending 

TORONTO, Dec. 3, 2021 /CNW/ – More than 60 per cent of Canadian shoppers say they showed spending restraint by staying on budget for this year’s Black Friday and Cyber Monday sales, but one-in-four (23 per cent) report they overspent significantly. For those who struggled to stick to their budgets, the impact of the first major spending event of the holidays could lead to less cash on hand for gift-giving this holiday season and more credit card debt as they head into 2022. 

Black Friday Infographic (CNW Group/FP Canada)
Black Friday Infographic (CNW Group/FP Canada)

The results of the new consumer survey, conducted by FP Canada™ among members of the online Angus Reid Forum, showed the average Canadian shopper spent about $385 in total on both shopping events — and those who did go overbudget spent, on average, more than three times as much (269 per cent more) as they’d planned to.  

But the majority of Canadians kept their spending under control, particularly those in the Prairies, where almost 90 per cent say they kept or came in under budget during the several days of sales that comprise Black Friday/Cyber Monday. 

“Whether due to added frugality, inflation fears or an increased focus on staying financially responsible this year, it’s clear that Canadians are watching their wallets this holiday season,” says Tashia Batstone, President & CEO of FP Canada. “While there’s always potential for an increase in last-minute spending, it appears that many Canadians may be giving themselves the gift of a stronger financial start to 2022 by sticking close to their budgets to end 2021.” 

Nonetheless, the early-season overspending by some Canadians is likely an earlier indicator of increased holiday debt, with the survey showing that, on average, Canadians expect to carry $814 more in credit card debt into the new year than they had before the holiday spending season.  

“With more bricks-and-mortar stores open due to easing pandemic restrictions, it’s easy to understand the temptation to spend. But it’s important for Canadians to be diligent about getting back on track financially if they’ve gone a little overboard already this holiday season,” Batstone said. 

Younger Canadians aged between 18 and 34, in particular, had a tougher time sticking to their spending plans this year, with one-in-three (32 per cent) saying they spent more than they had budgeted for on Black Friday and Cyber Monday – nearly twice the proportion as those 55 and over. Canadians between 18 and 34 also expect to see the biggest spike in credit card debt from their pre-holiday average ($4,211) to their average expected credit card debt after the holidays ($5,486). 

The survey also revealed Alberta shoppers were the most likely to overspend, with one-third saying they spent more than they had planned for and nearly 15 per cent saying they spent more than $500. Shoppers in Ontario also had trouble keeping their spending on target during the shopping holidays, with a quarter (24 per cent) saying they spent more than they’d intended to so far this season. 

Shoppers in Saskatchewan and Manitoba, on the other hand, spent an average of $266 during the shopping holidays – nearly a third less than the national average.  

While many Canadians may stay on track to rein in their spending throughout the remainder of the holiday season, others say they expect to take on more debt to spread added cheer this year. While Canadians with credit card debt average $3,962 of debt entering the holiday season, that number is expected to rise to $4,776 before 2022 kicks off. 

Planning is the gift that pays for itself 

The survey also found that Canadians working with a Certified Financial Planner® professional or Qualified Associate Financial Planner™ professional did a good job at sticking to their budgets and keeping their debt in check over the early shopping season. 

Three-quarters (76 per cent) of shoppers who say they work with a professional financial planner kept to their Black Friday/Cyber Monday budget, and nearly seven in 10 say they entered the holiday shopping season (67 per cent) and expect to make it through to the new year (69 per cent) without carrying any credit card debt. That’s compared to only 49 and 51 per cent, respectively, of those who don’t employ the services of a CFP® professional or QAFPTM professional.  

It’s not too late for those who overspent early to get their finances back on track before the new year. These are the top three tips from CFP professionals and QAFP professionals to help Canadians get their holiday budget back on track if they burned holes in their wallets on Black Friday and Cyber Monday sales:

  • “If you didn’t have a budget for your holiday spending before Black Friday, start one today,” says Sucheta Rajagopal, a CFP professional at Research Capital Corp. in Toronto. “Having a clear sense of how much you are spending is the easiest way to make sure that you don’t dig yourself into a debt hole so deep that you need to spend the next year digging out of it.” 
  • “Look for more reasonably priced gifts for those still left on your list,” says Graham Plumb, QAFP and founder of Moola Financial Coaches and Advisors in Victoria, B.C. “The difference between a $75 gift and a $100 gift will have a much greater impact on helping you keep your finances in order than it will on the amount of joy it brings the person who opens it.”
  • “Talk with a professional who can help you take an honest look at not just your holiday financial forecast, but your long-term financial wellbeing as well,” says Iftikhar Mahmood, CFP and CEO at CreateWealth Planning in Markham, Ont. “Working with a QAFP professional or CFP professional can help you identify ways to not just overcome short-term shortfalls but ensure you’re able to set yourself up to be financially strong in the long term.”

About the survey 

An online survey of 1,511 Canadians was completed between Nov. 30 and Dec. 1 among members of the online Angus Reid Forum. For comparison purposes, a probability sample of this size has an estimated margin of error of +/- 2.5 percentage points, 19 times out of 20. The survey was offered in both English and French. 

About FP Canada 

A national certification and professional oversight body working in the public interest, FP Canada is dedicated to championing better financial wellness for all Canadians by leading the advancement of professional financial planning in Canada. There are about 17,000 Certified Financial Planner professionals and about 1,900 Qualified Associate Financial Planner™ professionals (as at September 30, 2021), who meet FP Canada’s rigorous professional and ethical standards. Learn more at FPCanada.ca

SOURCE FP Canada

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