Summer Vacation Spending Intentions Rise While Other Discretionary Spending Intentions Hold Steady
Despite increasing economic uncertainty, 17 percent of consumers, the highest in nearly two years, plan to spend more on a major purchase like a vacation in the month ahead. This is a 2-point increase from the prior month. Last year, the number of consumers planning to spend more in this category dropped 1 point from May to June.
There was little month-to-month change in the number of consumers planning to increase spending in other discretionary spending categories like:
- Going out to dinner, movies or sporting events (remained flat at 10 percent)
- Home remodeling or new appliances (decreased from 17 percent to 16 percent)
- Savings and investing (decreased from 9 percent to 8 percent)
“Summer travel seems to be the only area of increased spending by consumers whose confidence in the economy continued to decline,” said Julie Loeger, senior vice president of brand and product management for Discover. “But beyond vacations, consumers’ spending intentions have pretty much held steady.”
More Consumers See Economic Conditions Worsening, but Nearly Half Have Money Remaining After Paying Monthly Bills
Forty-eight percent of consumers feel economic conditions are getting worse, a 3-point increase from May and 5-point jump in the last two months.
The decline in economic confidence correlated with a 2-point drop to 33 percent in the number of consumers rating their finances as good or excellent. Looking ahead, only 20 percent feel their financial situation improving, 2 points lower than May.
Despite the drop in financial confidence, 49 percent of consumers expect to have money left over after paying monthly bills. While still below 50 percent for the 15th straight month, this is the highest this number has been since March 2009.
The number of consumers expecting an income shortfall in the month ahead inched up a point in June to 38 percent.
