Australians are spending an estimated $20 billion on gifts for loved ones, new research has found, and most are doing so on the spur of the moment without having budgeted for the purchases. But which celebrations attract the biggest spend on average?
In time for Financial Planning Week (19 to 25 August), the Financial Planning Association (FPA) released the results of a poll of 1,000 Australians on their spending habits, which concluded that gift-buying in Australia is worth $19.8 billion.
It found that adults on average spend $100 each month on buying gifts. It also found interesting trends between men and women.
“The research shows we spend about $1,200 per person each year. That’s more than buying a $4 cup of coffee every day, or getting our shirts dry-cleaned every day,” the FPA’s CEO, Dante De Gori, said.
Men were found to spend $22 more each month on average than women. But women splash out more on their partners than men do, spending $454 each year on their mate compared with the $419 that men spend.
By age group, members of Generation Y (those aged 25 to 39) are by far the most generous in terms of the amount they spend on presents every month, at $130 each. Next was Generation Z (aged 18 to 24) at $91, closely followed by Baby Boomers (aged 55 to 73) at $89 and Generation X (aged 40 to 54) at $87 each.
Despite the big spending, the vast majority (85 per cent) of Australians polled said they actually get more joy from giving presents than receiving them.
Where is that money going?
According to the FPA, spouses or partners account for the largest share of funds spent on gifts. It said that Australians spend an average of $437 on their partner – more, even, than the $361 that are spent on presents for their own children.
Parents attracted the third-highest spend, with $201 shelled out per parent.
Rounding out the top four was not friends or colleagues, but our pets, who receive gifts worth an average of $115 per year. A quarter (26 per cent) are buying presents for their furry, feathered and scaled friends at least once a month.
Spending on different types of gifts
Some of the most lauded holidays and celebrations also tend to attract the highest value in terms of money spend on the gift purchase.
The research found that Australians on average spend:
- $137 on a wedding present – two in five people said they prefer to give cash of gift cards as a wedding present.
- $93 on significant Christmas gifts. That figure rises to $117 among families with young kids. Money or gift cards were the most common type of Christmas present, with 31 per cent giving these. The next most popular are food and alcohol (14 per cent) and tech/gadgets (12 per cent).
- $66 on an adult’s birthday present.
- $50 on a present for a child’s birthday, where the child is not their own. For teenage birthdays (other than their own son or daughter), that rises to $66.
Interestingly, men were found to spend more than women on gifts for all of these special occasions.
That’s what gets spent. But what do people actually want?
Rather than physical goods, most Aussies would actually prefer to receive cash as a gift – a trend the FPA said was consistent across all age groups, genders and geographic locations.
That was also fairly consistent across the different types of celebrations. For instance, more than a third of couples getting married (36 per cent) say that cash or gift cards are their preferred type of gift, according to the research.
When it comes to celebrating our “special” birthdays, sharing a meal with loved ones or doing an activity together were far more popular ways to mark the occasion.
Cash and tangible gifts were the next most preferred options.
Rounding out the top five preferences was a simple phone call, card or text message.
3 in 4 gifts are unplanned purchases
Businesses will be keen to hear that of the almost $20 billion spent on gifts, almost three-quarters (73 per cent) of that are unplanned purchases.
“There’s literally billions of dollars of household spend that is simply not budgeted for by nearly three in four Australians across genders, generations and geographies,” said Mr De Gori.
Group-buying a popular pastime
That is not to say that there is no planning in the purchase of presents at all. Some 73 per cent of respondents said that they have bought presents as part of a group.
This practice was noticeably more common among younger Australians, the FPA said, with 80 per cent and 81 per cent of Generation Z and Generation Y stating they participate in group gift-giving, compared with 62 per cent of Baby Boomers.
Another strategy is buying gifts in bulk, in order to save both money and time.
Female shoppers were found to be more inclined to bulk-buy presents than men (31 per cent to 24 per cent).
Women more likely to regift something
While the reasons for regifting were not stipulated, a sizeable proportion of people admit to regifting something they have received to another person.
Some 41 per cent of those surveyed said they have regifted a present, with women again more likely to do so than men (48 per cent versus 35 per cent).
The FPA suggested that the practice of regifting unwanted or unused items “is a smart strategy to reduce waste and lengthen an item’s lifespan”.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.