#USA #Chicago #Holiday Spending #BMO Financial #Latino Consumers

Rethinking Holiday Traditions and Travel Plans

As the holiday season approaches, recent findings from the BMO Real Financial Progress Index reveal a notable shift among Latinos in the U.S. Faced with rising costs, many are reconsidering their traditional holiday plans. The average Latino household now anticipates spending nearly $2,700 this season—up almost $650 from 2024, marking a striking 30% increase.

The Impact of Financial Pressures

Despite the significance of family celebrations during the holidays, economic factors are significantly influencing spending decisions. Lizzy Diaz-Ortiz, Vice President of Hispanic/Latino Banking at BMO, underscores the dilemma: "Family celebrations are central to Latino holiday traditions, but rising costs are forcing many to rethink their plans." This sentiment echoes throughout the community, with many Latinos cutting back on essentials such as travel, decorating, and entertaining.

Interestingly, while over half (51%) of respondents express that holiday plans are more important than savings, the reality is difficult to ignore. The average Latino plans to allocate approximately $210 for entertaining— a significant decrease from $390 last year— indicating a shift away from hosting large gatherings. Furthermore, only 41% of Latinos are budgeting for travel this year, a considerable drop from 59% in 2024.

Changes to Travel Plans

Travel has traditionally been a cornerstone of holiday celebrations within Latino families. However, the data shows that many are either changing their travel plans or canceling them altogether due to financial concerns. Within this demographic, 44% have changed their domestic travels, and 16% have postponed or cancelled entirely. In comparison, only 35% of the general U.S. population have done the same.

Additionally, for international travel, 36% of Latino respondents reported altering their plans, with 16% cancelling, compared to 29% and 12% respectively among the general population. The primary driver behind these cancellations is the rising day-to-day costs, with almost half of those who cancelled their plans identifying it as their main priority over travel expenses.

Financial Anxiety during Holidays

The financial landscape for Latino families is becoming increasingly concerning, particularly as half of the respondents in the study indicate heightened anxiety about their overall financial situations over the last three months— a 6% increase over the broader U.S. population's concern. Job security fears are more pronounced as well; 26% of Latinos are increasingly worried about layoffs compared to 23% in the general population. However, Latinos demonstrate proactive adjustments, with 71% modifying their shopping habits in response to economic conditions such as tariffs.

Strategies for Financial Stability

To cope with these rising costs, Latinos are getting creative. Some are taking on side jobs—44% reported doing so in pursuit of additional holiday income, surpassing the 38% of the general population engaged in similar efforts. Furthermore, 51% have consciously cut back on gifts throughout the year to ensure they can afford their holiday traditions.

BMO offers several tips to assist Latino families in maximizing their financial plans this holiday season:

• - Build a Budget: Utilizing resources to create and adhere to a budget can help manage current and future holiday expenses.
• - Leverage Reward Programs: Utilizing credit card reward points can stretch holiday budgets further, making travel and festive activities more accessible.

Conclusion

As Latino families navigate the current economic landscape, the emphasis on financial planning and smart spending is critical. Through thoughtful budgeting and resourceful planning, many can still honor their beloved traditions without sacrificing their financial future. The BMO Real Financial Progress Index continues to serve as an essential tool in understanding and improving the financial well-being of Latino consumers during these challenging times.