CHARLOTTE, NC (WBTV) — Consumer spending rebounds as more people buy goods.
A key sign was that people were putting more on their credit cards during the 2021 holiday season.
During the fourth quarter of 2021, credit card spending jumped 20% for American Express cardholders.
This number is good and bad because it shows that the economy is recovering, but bad in the sense that people are choosing to take on more debt.
“People really wanted to spend more and were just thrilled to give gifts,” said Lily Sanford, owner of Lilbelle in Charlotte.
That’s the change Lilbelle saw in 2021 during the fourth quarter, a time when holiday shopping rebounded.
In 2020, people spent $131 at his store in a single visit, but that increased in 2021.
“It’s about $140 in the fourth quarter. That being said, it may be higher in other neighborhoods when people are spending on themselves. We see a trend after Black Friday. Customers really want to spend on others,” Sanford said. “These are people who want to spend money because they want to wear new things because they have places to go. But on top of that, they carry that 2020 mindset like we really want to support local, and we want to see you succeed.
Dr Steven Cox, professor of marketing at Queens University of Charlotte, said: “Well, I think people feel more comfortable with the economy, they feel more comfortable with their ability to have a job, to be able to return to work.”
In addition to people who feel comfortable with the economy, the professor added that others buy things out of fear of running out or raising prices due to inflation and chain issues. supply.
“There’s a lot of pent-up demand during COVID due to the uncertainty because people weren’t going out. This demand translates into increased purchases. Also, the increase in purchases doesn’t come in because credit card companies aren’t getting much faster numbers over 19 in 2019,” Cox said.
Cox thinks spending will continue to rise in 2022 if we don’t see another variant of COVID disrupting the country and the economy.
Improving Credit says that before you add more debt to your credit card, first sit down with your partner or the person in charge of your finances and come up with a plan.
Wanda Strickfaden, owner of Improve Credit, said: “Set a budget, give yourself an actual financial limit of what they can and cannot spend in that month on their credit card debt. I always tell my consumers that if you can’t pay off your balance in full, don’t borrow.
Strickfaden understands that some people have had to rely on their credit cards due to the pandemic to pay for regular bills, medical bills, and daily living.
“I understand that some have no control over whether they can borrow with their credit card because of these situations. So instead, I always tell your creditors to help you with a hardship program. So if you are having financial difficulty paying your credit card balance, you can take advantage of that difficulty to relieve yourself in your financial situation at that time,” Strickfaden said.
Improve Credit tells WBTV that it offers free assessments for people who need help with their credit report or credit scores.
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