SOURCE: SaveUp, Inc.

SaveUp

January 16, 2014 08:03 ET

Americans Falter on Plans to Reduce Credit Card Spending

New SaveUp Data Indicates the 2013 Holiday Season Was a Return to Expanding Credit Card Bills

SAN FRANCISCO, CA--(Marketwired - January 16, 2014) - SaveUp (www.saveup.com), a national online financial rewards program for saving and paying down debt, today announced the findings of its January U.S. Consumer Savings and Debt Report that identifies consumers' savings and spending habits. This past holiday season1 indicates that US consumers are returning to old habits of funding consumption through debt rather than living within their means. 

In the November US Consumer Savings and Debt Report 69.7% of Americans reported they planned to use cash for holiday spending. Despite their lofty goals, consumers actually funded the 2013 holiday with debt and entered the New Year with bigger bills. This stands in contrast to the 2012 holiday season when consumers used cash and savings to cover holiday spending. 

     
  Nov to Dec 2012 Nov to Dec 2013
Checking Balance $5 Higher$98 Higher
Savings $695 Lower$122 Higher
Money Market $999 Lower$125 Higher
Credit Card Debt $964 Lower$363 Higher
Line of Credit Debt $2,419 Lower$1,172 Higher
         

This year's data demonstrates that Americans failed in their attempt to continue with financially responsible holiday spending habits from 2012. There is also a significant reversal in the positive trends established in the prior holiday season. 

In 2012, consumers heavily relied on savings and money market accounts for holiday spending. During the 2012 holiday season, Americans withdrew an average of nearly $700 from savings accounts to cover the costs of holiday spending. Those Americans who had money market accounts also withdrew heavily over the same period, to the tune of $1,000. 

During the 2013 holiday season, the consumer behavior changed rather drastically and not necessarily for the better. This holiday, Americans leveraged credit cards and lines of credit to fulfill their holiday purchasing. The average American racked up over $350 of debt on credit cards this holiday season. Last year Americans were actually paying down credit card debt during the holidays. We also witnessed significant growth in the reliance of lines of credit to make holiday purchases.

"As the banking industry continues to rebound from 2009 and debt becomes more accessible, Americans are falling back into old habits," said Priya Haji, CEO of SaveUp. "Ultimately, consumers leveraged debt for holiday purchasing more so in 2013 than in 2012 despite plans to do otherwise. These habits will need to be broken in order to avoid the constant threat of financial ebb and flow."

Methodology
The SaveUp U.S. Consumer Savings and Debt Report analyzes current savings and debt levels of its user base and makes monthly comparisons pulled at least 30 days prior and no more than 90 days prior to the stated month. This month's report is based on the data of a representative sample of more than 20,000 SaveUp users' savings and debt balances.

About SaveUp
Founded in 2011, San Francisco-based SaveUp is the first free nationwide rewards program that encourages Americans to save money, pay down debt and make positive financial changes. By partnering with major consumer brands and financial institutions, SaveUp gives users the opportunity to win exciting prizes for performing positive financial actions. Individual user information is secure on the site with bank level encryption. Intuit provides the back-end aggregation technology and SaveUp has completed a bank-level security audit.

To get rewarded for your positive financial actions or to partner with SaveUp as a bank or sponsor, please visit us at www.saveup.com

Footnotes
1. Holiday Season is defined as November and December

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