Holiday shoppers may buy less—but spend the same

If your shopping bags seem less full this holiday season, even though you’re spending the same amount as previous years, your eyes aren’t fooling you.

With a year of tariffs and inflation making for a shaky economy, retail prices are going up, as are hidden tactics like shrinkflation and skimpflation, where prices stay the same but you get less quantity or quality.

The result may be that while consumers plan to stick to the same budget, their dollars won't go as far. "With the cost of everything going up, we'll probably see people buy less because things are more expensive," said Ryan Valencia, senior consumer product manager at BOK Financial®.

Gift giving to continue, despite inflation and weakening job market

Still, most customers will want to spend some money on holiday gifts, if they can afford it, said Steve Wyett, chief investment strategist at BOK Financial. “The U.S. consumer usually manages to overcome whatever hesitation they might have and spend money on Christmas. At its base, the idea of cutting back on gift giving in general on a broad aggregate basis really is not something that we would anticipate, if the consumer has the money."

An October Gallup poll revealed that holiday shoppers generally planned to spend about the same amount as last year on gifts. However, lower-income households planned to spend roughly $100 less than before, and higher-income households planned to spend slightly more. Meanwhile, the National Retail Federation is predicting that altogether holiday sales this season will surpass $1 trillion for the first time ever.

For consumers on a tight budget, the "if they can afford it" may lie in several factors. One is the job market. Both the unemployment rate and number of unemployed people stayed relatively stable from September to November 2025, but both figures were higher than they were a year ago, according to November employment data. There is also news of longer job search times, coined as the "Great Freeze" in hiring, which could lead to more job uncertainty.

Rising insurance premiums, mainly health insurance, has been another topic of concern as the government continues to ponder extending subsidies or other solutions to ease rising premium costs set to take a bigger bite out of people's paychecks. "Open enrollment for health insurance is always at the end of the year, right around holiday spending time," said Valencia. "People are likely to be concerned with what their paycheck will look like next year.

Wyett said those who've been able to invest in the stock market and have seen record-breaking highs this year may feel more optimistic, and some can look forward to bigger tax refunds to pay off holiday spending, thanks to the extension of the Tax Cuts and Jobs Act.

AI may be some consumers’ new favorite shopping companion

The biggest issue at hand may be how to stretch dollars a little farther this year, and for that, Valencia sees people turning to artificial intelligence (AI). "The use of AI seems to be a categorical shift. People are telling it, 'Here's my budget, here are the four people I'm shopping for or here's their wish list. Help me find gifts within this amount I want to spend.' It's really good for researching and being a shopping companion."

He said people are also using shopping apps inside stores to scan products and see if there are better prices available elsewhere or online. Apps such as ShopSavvy and Barcode Scanner - Price Finder can be loaded right on your phone to scan barcodes anywhere.

Though “buy now, pay later” (BNPL) loans are growing in popularity to “kick the proverbial can down the road," consumers need to use with caution and keep track of repayment installations to avoid getting into financial trouble.

Valencia summarized that shopping strategically will be key this holiday season. "At the end of the day, know what your budget is. Take advantage of whatever you can use to find the best prices and the best sales and get those deals that are out there."