The True Cost of Christmas

Could it be that the holidays are bad?
Could it be that inflation is making you sad?
Maybe it’s the fact the energy crisis is making you mad?
But can we still make your Christmas rad?

It’s that time of year when Christmas tunes fill our local shopping centres, parents are totally cool with their kids talking to a strange old man dressed in red and our wallets become fair play for our friends and family. However, in the midst of all this Holiday cheer, there’s a storm brewing.

The holiday season is normally a good time to throw caution to the wind, but things may be changing this year. With interest rates rising, petrol costs fluctuating, and bills piling up, we’re left wondering whether the holiday season is in for some changes this year. To understand how Aussies are feeling about this year’s holiday season, we commissioned iLink Research to conduct a national survey of 1,000 Aussies.

Ho, Ho, Ho-w do you celebrate?

Before we begin the writer would like to apologise for the above and/ or any future corny Christmas themed jokes.

Everyone celebrates differently, some like to spend exorbitant amounts of money on everything Christmas, whilst others like to stay on the affordable side, opting for a tree and some gifts for close loved ones. However, to understand what the reality of the Christmas crunch is for Aussie families we wanted to understand how much people usually spend around this time of year.

How much do Aussies spend for christmas?

We found that 55% of Aussies surveyed estimate their households spend over $500 on Christmas each year.¹ Compare this with the 34% of thriftier Aussies who spend under $500.²

We then move on to our big spenders, with one in four spending more than $1,000, while 14% estimate spending over $1,500 during Christmas.³

From this it’s clear that over half of the Aussies surveyed spend a decent amount of their income on the holiday season, however, will this continue?

You’re a mean one Mr… inflation?

10 years of wage vs inflation changes

Can Christmas continue?
No. (Just kidding!)

Of course, the spirit of Christmas will likely never cease (like the love we have for ‘All I Want For Christmas Is You’… thanks Mariah!), but our consumer spending around the high holidays may.

On to the boring numbers…

In Australia the average annual income is estimated at $1769.80 a week, or $92,029.60 a year (before tax).⁴ Wow, that’s a decent amount of money (says the under 30-year-old writer writing this). However, when comparing annual wage growth vs annual inflation things become concerning. While both wages⁵ and inflation⁶ are growing, the inflation rate has significantly outgrown wages resulting in even more strain on Aussies.

Where do Aussies shop for Christmas?⁷

When asked about the increasing cost of living and whether people would take steps to reduce their Christmas spending, 58% of those surveyed said they would, with almost a quarter of those surveyed saying that they would reduce their spending ‘significantly’.⁸

So, what does that mean for your Christmas celebrations?

Just because our cost-of-living woes are increasing doesn’t mean we have to become The Grinch… right? If Tiny Tim’s family could do Christmas on a budget, why can’t we?

When we asked where our surveyed Aussies shopped for Christmas supplies (such as decorations, presents and lights), 25% said their go-to store was Kmart⁹ followed by Big W and Target.¹⁰ Interestingly the top three stores surveyed Aussies are going for their Christmas supplies are all discount department stores meaning thrifty shopping may already be occurring!

So, now that you have your decorations, hopefully purchased at a decent price, what else could be stopping you from decoration bliss?

Did someone say energy crisis?

The 2022 Energy Cris-mas

This year was truly one for the history books. We stopped the pandemic (yay!), it came back (no!), we didn’t have a record-breaking bushfire season (yay!), we did get record-breaking damaging floods (no!), supermarkets started locking prices (yay!), it wasn’t for things that actually needed it like fresh fruit and veggies (no!) and so on… but one of the biggest kickers was the energy crisis. With foreign affairs and northern hemisphere economies increasing prices, Aussies really felt the hit when it came to our energy bills. So, with the skyrocketing inflation and energy prices through the roof, what does that mean for our Christmas decoration enjoyment?

When asked how power bills increasing will this impact how people will use Christmas lights, a whopping 51% said they won’t be using them at all this year (or not as many).¹¹ So, it seems fairly evident that we’re all pretty aware:

Lights = energy usage
Energy usage = money
Spending money on energy = sadness

However, did you know that for the average Australian household, lighting accounts for 10% of an electricity bill?¹² With that said, before we shun the Christmas season haphazardly, we wanted to calculate how much Christmas lights cost for an entire holiday season. So, let’s break down the potential cost of running Christmas lights.

^For these estimations we presumed you will be running your Christmas lights for a 31-day period for 6 hours per day and at an assumed consumption rate of 31.59c/kWh¹³

The key take-away from this is that there is a huge discrepancy between the cost of LED lights in comparison to incandescent lights. If you’re likely to prefer incandescent, the cost could potentially cause you to avoid participating in this form of holiday enjoyment. It is also important to keep in mind that these calculations are demonstrating the usage of just one product, so if you were to have your home decked out in lights à la the Griswold family Christmas, your energy costs (and lack of holiday calm) are likely to grow.

Twinkle light fight!
How can you get in the spirit?

Your best energy saving bet: Go for the LEDs or the environmentally friendly solar lights!

Whilst there may be some deterrents when participating in this form of festive activity, putting up Christmas lights at this warm time of year may not only put a smile on your dial. But it can also bring out joy, happiness and general Festivus merriment for others during the season ahead. So, whether it’s a little hint of the season or an all-out spectacular you can always work within your budget to make your heart grow three sizes larger (in a completely healthy non-life threatening way of course!!).

See if you can save

Not sure if your energy costs will survive the Christmas season? It may be worth comparing from a range of energy plans and providers with iSelect. To quote ‘Hi-5’ “Santa Clause is coming, Santa Clause is coming, he’s not very far away” it’s time to hang those lights up with a great energy plan!

Want to see if you can experience a chill that rivals the north pole this Christmas? Why not compare our range of energy plans and providers and see if you can find yourself a good deal!

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