2017 Holiday Budgets by City
3:12 AMPosted by: Richie Bernardo
Besides bringing good cheer, the holidays also can invite seasonal stress, a primary source of which is our addiction to spending. The National Retail Federation predicts the average per-person tab this holiday season will reach $967, up nearly 3.4 percent since 2016.
Besides bringing good cheer, the holidays also can invite seasonal stress, a primary source of which is our addiction to spending. The National Retail Federation predicts the average per-person tab this holiday season will reach $967, up nearly 3.4 percent since 2016.
Although a few extra bucks might seem negligible, the NRF’s estimate for this year’s average holiday spending actually represents an increase of more than 20 percent over the past two years. And the consistent growth is a rather big deal, considering our rapid accumulation of plastic debt. Americans are on track to end 2017 with more than $60 billion in additional credit-card balances, according to WalletHub’s projections. That figure puts us perilously close to the nearly $1 trillion grand total recorded at the height of the Great Recession.
To help consumers avoid post-holiday regret, WalletHub’s analysts calculated the maximum holiday budget for each of 570 U.S. cities using five key characteristics of the population, such as income, age and savings-to-monthly expenses ratio. Read on to get a better sense of your area’s spending range. Below the ranking you’ll find invaluable holiday-spending advice from WalletHub’s panel of financial experts as well as our full methodology.
Are you in danger of wrecking your Black Friday spending plans? WalletHub will calculate custom holiday budgets for all WalletHub members between now and Dec. 25, so make sure to join our community today. And if you want to get ahead of the shopping crowds, check out our preview of 2017’s Best Black Friday Ad Leaks.
Main FindingsEmbed on your website<iframe src="//d2e70e9yced57e.cloudfront.net/wallethub/embed/16912/geochart-holidaybudget.html" width="556" height="347" frameBorder="0" scrolling="no"></iframe> <div style="width:556px;font-size:12px;color:#888;">Source: <a href="http://ift.tt/2AJ65sk;
Holiday Budget by City*No. 1 = Biggest
Ask the ExpertsHoliday spending is driven largely by the current economic climate, among other factors. In order to help consumers keep their holiday budgets in check, we asked a panel of experts to share money-saving advice and insight regarding key factors that impact consumer spending during the busiest shopping season of the year. Click on the experts’ profiles below to read their bios and thoughts on the following key questions:
- What tips do you have to help people avoid holiday overspending?
- How do you think the current social and economic environments are influencing household holiday spending decisions?
- Where should people draw the line in determining who to purchase a gift for?
- How can people show love and appreciation over the holidays without spending money on gifts?
- Nearly one in 15 adults are shopaholics. How can someone tell if he or she is a shopaholic?
Sridhar Balasubramanian Professor of Marketing, Roy and Alice H. Richards Bicentennial Distinguished Scholar and Senior Associate Dean of MBA Programs in the Kenan-Flagler Business School at The University of North Carolina
Seth Ketron Assistant Professor in the Department of Marketing and Supply Chain Management at East Carolina University College of Business
Rashmi Adaval Professor of Marketing in the Carl H. Lindner College of Business at the University of Cincinnati
John R. Sparks Professor of Marketing and Associate Dean for Undergraduate Programs at the University of Dayton School of Business Administration
Greta M. Keiper-Blake Assistant Professor of Marketing in the Department of Business at Mars Hill University
Glen Riecken Visiting Professor of Marketing in the School of Business at the College of Charleston
Colin Gabler Assistant Professor of Marketing and Freeman Fellow at the Ohio University College of Business
What tips do you have to help people avoid holiday overspending? First -- budget, budget, budget. Clarify the budget for holiday spending at the level of the family and at the level of individual family members. Also, clarify the budget for gifts to those outside the immediate family unit, i.e., for relatives and friends other than the core family unit comprising parents and their kids. To impose additional discipline, give each family member a gift card that represents their share of the budget. How do you think the current social and economic environment is influencing household holiday spending decisions? Gift giving is generally positively correlated to consumer sentiment, which, in turn, is influenced by the state of the economy. The average consumer at this stage is positive about the economy and where it is headed. The value of housing stock is up, and consumers are generally feeling good about their financial status. Against these positive drivers, though, is the fact that real wages for many lower-income workers have been slow to expand, especially in comparison to the wealth levels of higher-income individuals, who are more likely to both own housing stock and participate in the stock market. Therefore, in my opinion, as far as the effects of the economic climate are concerned, gift giving is likely to be robust for higher-income segments, but suppressed for lower-income segments. Where should people draw the line in determining who to purchase a gift for? Asking the following questions are useful in this context:
- Have you received a gift from that person? If so, reciprocating that gift is appropriate.
- Do you value the relationship enough that you can commit to giving gift each holiday season into the foreseeable future, irrespective of whether the gift recipient reciprocates? As easy as it is to start with giving a gift, it can be awkward to abruptly stop giving a gift.
- A consistently high returns/purchase ratio;
- Closets and cupboards overflowing with unopened purchases;
- The customer service desk personnel know your name.
What tips do you have to help people avoid holiday overspending? One way to avoid overspending is to set strict budgets, and develop accountability with family members or friends to ensure that those budgets are not exceeded. Just as accountability partners can help us reach our dieting and/or fitness goals, accountability partners can help us avoid spending too much. The key here is to ensure that you take someone along who is good about holding you accountable for your spending. Another way is to try to use cash whenever possible. Credit and debit cards create psychological distance between us and our money -- because we aren't actually physically handing over cash in a transaction when we use our cards, we tend to feel less connected to our spending, and thus are more apt lose control. As an added bonus, using cash allows us to set our limits while we are thinking clearly. Often, stores include so much stuff that invades our senses that we tend to think less clearly as we shop, which can lead us to (erroneously) downplay overspending in those moments. This latter point is especially important during the holiday season. For example, red, a common color in many holiday displays, serves a dual purpose -- it not only symbolizes Christmas and other holidays during this time of year, but also piques our physical and psychological centers of action. Namely, red is the color of impulsiveness and can increase our spending without our realizing it. Further, research has shown that pairing certain holiday smells (i.e., cinnamon) with holiday sounds (i.e., Christmas music) leads to more favorable consumer responses, so many stores try to match up as many of the senses as they can to get us to spend more. Therefore, it's a good idea to be aware of these influences and to try to account for them as you shop. How do you think the current social and economic environment is influencing household holiday spending decisions? Ever since the recession late in the last decade, consumers have been changing their gifting habits toward more frugal spending and more meaningful or sentimental gifts. Some families who were hit hard by the recession have reduced the quantity of gifts they purchase, and often opt for novel ways of exchanging gifts, like the so-called "white elephant" gift exchange. As far as occurrences of the recent past, it's too early to really tell how social and economic influences will affect this holiday season. However, unseasonably warm temperatures will likely continue to reduce spending on typical holiday apparel purchases like sweaters and cold weather accessories, so retailers that have invested heavily in these categories will likely face stiff markdowns if the weather remains warm throughout the holiday shopping season. Where should people draw the line in determining who to purchase a gift for? A good policy is to define the boundaries of gift giving early on. For example, you may wish to discuss with friends and family ahead of time about whether gifts should be exchanged, how much is to be spent, etc. It's also important to be fair. If you can't give a gift to everyone within a social unit (all siblings, cousins, or other family member groups; all coworkers within a specified work group; etc.), it's better to avoid gifting in that unit altogether so that you don't damage relationships. How can people show love and appreciation over the holidays without spending money on gifts? Making gifts for people is an age-old way to give gifts that won't break the bank. Also, gifts don't have to be conventional -- children who have no money to spend on gifts often make things like "coupon books" for their parents for free hugs, free chores, etc., that convey love and appreciation without spending money. Adults can find creative gift ideas like this, that won't require extensive shopping lists or spending. Most people appreciate the thought and sentiment that go into gifts, rather than just focusing on the gifts themselves, so really think outside the box. Nearly 1 in 15 adults are shopaholics. How can someone tell if he or she is a shopaholic? One of the clearest signs of any addiction -- including shopping -- is a loss of control. Feeling compelled to shop and spend even without a clearly defined need to do so, especially when these actions interfere with daily life and/or lead to excessive debt, are clear signals of a problem. Rashmi Adaval Professor of Marketing in the Carl H. Lindner College of Business at the University of Cincinnati 
What tips do you have to help people avoid holiday overspending? How do you think the current social and economic environment is influencing household holiday spending decisions? As the holiday season approaches and deals beckon, chances are that people will overspend despite any sage advice they get. Although some consumers are vigilant and keep tabs on their spending, others are seduced by the “Sale” signs and fail to realize that they have overspent until it is too late. Why does this happen? Part of the reason stems from our inability to remember numbers. Dickson and Sawyer in the 1980s showed us that memory for grocery prices is poor. People remember ballpark numbers (e.g., “This was about $20 odd dollars; could have been $23 or $25”). Given this lack of precision in consumer memory for prices, how does a consumer know whether the price is right or the Christmas deal on display is a good one? Suppose a consumer wishes to buy a sweater as a gift. They might rely on external cues provided by the seller (e.g., originally $57.99; sale price $45.99) and think this is a good deal, without really knowing whether the original price is the right price for this sort of item. The range of prices for any gift item is so large that the “internal reference price” becomes fuzzy and malleable, leaving one uncertain if the price is right. Given this uncertainty, consumers have become increasingly reliant on external cues, such as the “Sale” signs that appear during the holiday season. And, who can resist a bargain? Where you shop and what you walk past can make a difference, too. Our own research suggests that when you see big numbers (regardless of what they are), it activates large magnitudes (i.e., you think big). In that context, a particular item might seem inexpensive. So, if you have been wandering through an aisle of big ticket items for the kitchen (e.g., state-of-the-art food processors), a simple Crock-Pot sitting next to it does not seem terribly expensive. So, why not get it for your friend who just moved into a new apartment? The effects of high prices (whether they are listed as “original” prices or pertain to other big ticket items in the store, or even your newly increased credit card limit) are likely to affect how much you are willing to spend, and this is exacerbated when you are inattentive to the prices around you. Being aware of the fallible nature of human memory when it comes to prices is perhaps the first step to avoid overspending. Substantial research also exists on the payment mode we use during our shopping trips. Credit cards are associated with consumption, and mere exposure to them appears to activate a goal to consume. This was shown by Feinberg in the eighties, and subsequently by Raghubir and Srivastava. These researchers suggest that people are conditioned to certain cues like credit cards. Manoj Thomas finds that even people who are tightwads are likely to spend more when using credit cards. So, perhaps one way to prevent overspending is to leave your credit card behind and use cash. It is easier to keep track of money flowing out when you have something that is fungible. What might be even better is to set a spending limit, then divide it into smaller amounts and put these amounts in an envelope -- one for each person you intend to buy a gift for. Incentivize yourself by saying that if money is left over in each envelope, I will pool it and treat myself or give it to a favorite charity. Either way, it will make you feel good. Where should people draw the line in determining who to purchase a gift for? Our purchases also tend to be mindless. A body of work by Xu and Wyer suggests that we often tend to think about which item to buy, rather than considering the prior step of whether one ought to buy. Holidays might prime you to think about “what should I get” rather than “whether to get it at all.” “No gifts this Christmas” seems almost sacrilegious, especially because the season is about giving. But, in assessing whether one ought to buy, consider whether the recipient just wants it or really needs it. Would Uncle John really be upset if he didn’t get that tie? Or, would he be just as happy if you sang him a song or baked him his favorite pie? Can the season be more about “giving to those who really need it,” rather than an obligatory ritual that we persist in? How can people show love and appreciation over the holidays without spending money on gifts? There are many other ways to show appreciation. Instead of “more stuff,” is it possible to edge towards more experiences? Not commoditized experiences, but creative ones that are unique to your own family. Our family has had a long-standing Christmas tradition of buying $1-$2 gifts and writing a limerick for the recipient indicating why that gift was appropriate for them. And, we use it for invited guests, too. One of the nicest gifts I received was a keychain with a little yellow duck that quacks. My husband, tiring of my tendency to lose keys, decided that this would be the most appropriate gift for Christmas, and the limerick he composed said so. Twenty years later, I still have the duck. And, we chuckle when we re read the limericks we wrote for each other. People remember experiences, not stuff. Choosing something that is radically different might require buy-in from the various stakeholders. But, once you start a fun tradition for your family, it is likely to catch on. I am reminded of a family that suggested no gifts, but a donation to the dog shelter they cared about and in return, kids were taken on a trip to “walk the dogs.” It ended up being fun and an inspiration to other families as well. Nearly 1 in 15 adults are shopaholics. How can someone tell if he or she is a shopaholic? We have been conditioned to think of shopping as a necessary component of the holiday season. And, we are training our children, too. Halloween is all about candy and not about tricks. Christmas is all about shopping and not about giving. Online shopping for all its benefits exacerbates the problem, because it has only made it easier to buy. It just takes a click and you don’t even have to get out of your chair. It is easy to get into the habit of buying and spending on something you probably wouldn’t have purchased if you had to walk around several stores looking for it. Which brings us to a more general problem that exists beyond the holiday season: “How do you know if you are a shopaholic and have a problem?” The answers are simple. Do you have more than you need (e.g., a closet full of shoes you rarely wear)? And, do you hide your purchases from people you love because you feel guilty about the purchases? If you answered yes to the second question, you probably have a problem. Acknowledging it and being mindful about what you have is probably a step in the right direction. John R. Sparks Professor of Marketing and Associate Dean for Undergraduate Programs at the University of Dayton School of Business Administration 
What tips do you have to help people avoid holiday overspending? Start with a list and a budget, and then stick to it. Mental lists don't count as much as written lists do. Writing a list forces people to think and see clearly where they draw shopping lines. Optimally, the gift lists can be made early in the year, well before the holidays. That way, people can do their holiday shopping throughout the year a little at a time. This helps spread out the spending and the pinch is not quite so great during the holidays. No matter what, the key is discipline. Make the list, write it down, and stick to it. Because shopping online is so easy now and can be done from phones anywhere, anytime, lists are especially important, now that actually going to the store is no longer required to make a purchase. How do you think the current social and economic environment is influencing household holiday spending decisions? America is a marketing environment, and marketers judge their success by convincing people to buy. This is especially true when the economy is doing pretty well, as the U.S. economy is now. In the U.S. marketplace, the mantra is "More is better," and "Bigger is better." People start to tie their self-identities and their feelings toward others to the gifts they give and receive. The whole mentality defeats the idea of generosity, which is at the heart of gift-giving. We turn it into an obligation and not a selfless gesture for others. It can be a lot of pressure. Where should people draw the line in determining who to purchase a gift for? There are so many social and personal considerations tied into it. The answer lies in the nature of the relationships and the size of the budget. It can be a very personal and emotionally charged decision. The bottom line for many people is whether the people you would like to shop for would think less of you if you could not afford to give them anything. How can people show love and appreciation over the holidays without spending money on gifts? Here, common sense is the key. For many people, it's easier and emotionally safer to go to the store or go online and buy something to give. It's more difficult to write a heartfelt letter telling someone what they mean to you. Yet these are the gifts people remember. Making something, doing a favor, giving of your time. These are often more difficult and yet, they are the most meaningful gifts we can give. Nearly 1 in 15 adults are shopaholics. How can someone tell if he or she is a shopaholic? Shopping can be an addiction as powerful as any drug, and it can produce as much misery and heartbreak as any self-destructive behavior. People need to be honest with themselves and look at their shopping habits objectively. Imagine you had a friend who shopped exactly as you do. Would you think he or she had a problem? Diagnosing shopping addiction follows many of the lines of questioning as other addictions.
- How much of your life and your daily activities center around shopping? This includes thinking about shopping, browsing shopping sites on digital devices, or planning shopping trips. If shopping takes up a lot of your time and interferes with other parts of a person's life, it's a problem.
- Has shopping created trouble in a person's life? Trouble can include financial troubles, such as not paying bills in order to shop, or running up large amounts of debt. Compulsive shopping can lead to relationship troubles. Marriages have split up because of shopping addictions. If a person is experiencing these negative effects, then shopping addiction may be to blame.
- Does shopping create a short-term rush of excitement that turns to regret a little while later? Shopping addictions begin when the pleasure comes from the process of purchase, not the enjoyment of ownership or giving to others.
What tips do you have to help people avoid holiday overspending?
- You can’t go wrong if you set a budget and stick to it. Although easier said than done, technology can help. You can easily download a budgeting app (Gift List Lite). Set up your budget, enter your purchases as you go, and you can easily track your spending while you are out and about, or shopping online. Overspend? Maybe it’s time to return something, or make some cuts elsewhere. It is a simple tool for keeping your spending levels on track.
- If you shop online, there are many ways to ensure that you are getting the best deal. Browser extension Honey automatically finds and applies coupon codes when you are ready to check out, saving the users time and money. Another extension worth trying is InvisibleHand, which provides discreet, real-time price checks for online retailers, based on product information, not personally identifiable information. And of course, consider shipping. If you are going to shop online, try to place one big order early, in order to qualify for free standard shipping. Otherwise, price savings could be lost in shipping charges. If you shop with any of the participating retailers, free shipping day is December 15, 2017 this year, and on-time Christmas delivery is promised.
- Communicate with family about gift giving -- have a conversation to keep spending manageable. Perhaps it makes sense to only buy for children, or maybe to exchange names. The budget for the one gift can be a bit higher this way, and gifs may even become more personal, but overall spending is reduced,
- Think carefully about gift cards. Sometimes, savvy shoppers may be able to find greater value by purchasing a gift.
What tips do you have to help people avoid holiday overspending? Overspending. It may be a little late for this year, but a problem many people have is waiting to begin their Christmas shopping on Black Friday, or now even Thanksgiving Day. This means their expenditures are crammed into a few weeks, which can complicate December and January budgets. Such procrastinating may also lead people to making more hasty choices, where they might overspend in the rush to get through gift buying. Starting shopping early, at least for some people on the gift list, can help spread the expenditures over more months. Some people might have an idea of an overall amount they will spend on gift giving in the season. There are survey results of this every year. What is lacking, however, are follow-up surveys to determine how much people actually spent. Chances are the planned and actual figures would vary widely, as people tend to overspend. Writing a recipient list and putting a dollar amount by each name would help people get a better handle on a budget. How do you think the current social and economic environment is influencing household holiday spending decisions? Environment. There may be two synergistic forces at work here. On the one hand, the economy has been improving over the past several months and people are beginning to feel more optimistic. Even though wages are slow to rise, the rosier outlook may encourage people to spend more this year. The other force is the apparent degree of tension and dissatisfaction many people feel about the country. People, when stressed, often look for ways to find comfort, and over-indulging is a common result. This could carry over into greater gift giving as a way to feel good about themselves. Where should people draw the line in determining who to purchase a gift for? Gift limits. This is really an individual/family decision. Two major factors to consider are the size and composition of the family (generally the primary recipients) and the budget. Most often, it is the children (your own, if applicable) and nieces/nephews that get first priority. Parents are also usually high on the priority list. Many spouses choose not to gift each other. Siblings and cousins are often pared from the list as well. In many families, names are drawn randomly (and usually a dollar limit is set), which then requires each person to buy only one gift. In some cases, each person writes their name as well as two or three suggestions for the gift they would like. Another option to consider is to make gifts for some people. It might be something crafty if one is so inclined, or a box of homemade cookies and candy. One could also re-gift the fruit cake from Aunt Ethel last year, since odds are nobody will eat it anyway and it could circulate for a few years among the family (keep a record though). Nearly 1 in 15 adults are shopaholics. How can someone tell if he or she is a shopaholic? Shopaholics. Shopaholics have a chronic tendency to purchase products beyond what might be considered sufficient needs (and often beyond their resources). While many of us might enjoy a little frivolous shopping now and then -- none of us are rational consumers, no matter what we think -- for shopaholics, it is an addiction. And, like any addiction, the behavior becomes to control the person. There are various ideas about why someone becomes a shopaholic (estimates range from about 2 percent to 12 percent of the adult population, although a common statistic is about 6 percent), ranging from a way to deal with stress and anxiety to an extreme level of materialism. Tell-tale signs of a shopaholic include having storage space, like closets and drawers, full of unused new merchandise, feeling the need shop when confronted by stressful situations, feeling euphoric while shopping, but then feeling guilt after the deed is done. Colin Gabler Assistant Professor of Marketing and Freeman Fellow at the Ohio University College of Business 
What tips do you have to help people avoid holiday overspending? Typically, we spend more around the holidays than the rest of the year. As our consumption budget goes into the proverbial red, retailers go into the proverbial black. That is just one of the origin stories for the term “Black Friday,” but what is not debatable is that 30 percent of a retailer’s annual sales occur during the holiday season (recently, “Super Saturday” has garnered more sales than Black Friday). The best tip I can offer is to set your goals, create a corresponding budget, and then -- the hard part -- stick to it. For instance, let’s say your goals are to buy gifts for your three kids, travel to your in-laws, and host one party. Those are reasonable goals and can be scaled up or down depending on your budget, but each can get out of hand if you don’t put a limit on the spending. Using our example, you could decide to spend about $50 per child (totaling $150), or buy a joint gift for all three children that costs $100. Similarly, you could bring an air mattress to your in-laws or book a hotel nearby. Finally, your holiday party could be catered or a potluck affair. Each of these options fulfills your goals while staying within your budget. Where should people draw the line in determining who to purchase a gift for? Again, it comes down to your personal budget. Let’s say you want to spend $250 on gifts over the season. There are two schools of thought. Buy relatively expensive gifts for a select group people, or buy relatively inexpensive gifts for a large number of people. One example. My wife and I have gone from 0 to 10 nieces and nephews in just a few years. At first, we bought gifts for all of them, but when the number hit double digits, we decided to only buy gifts for our two goddaughters. We have one on each side of the family, so it worked out well. I’m generally of the fewer but “better” gift mentality, but sometimes, the act of giving and receiving is as important as the gift itself, especially for the giver. We get an emotional high when we buy things for other people, so naturally, we would want to feel that often. A person may decide to buy small gifts for 50 of his or her closest friends. That is also a great way to approach gift-giving -- if you stick to your budget. How can people show love and appreciation over the holidays without spending money on gifts? Time is often more meaningful than a physical gift. This is particularly true in two situations: when the giver’s budget is tight and when the receiver already has a lot of “stuff.” The first example is simple: you may not have the financial capability to buy presents for all the important people in your life. The second example is a more recent phenomenon. There is so much “stuff” on the market that one of the new promotional taglines is “For the person in your life who has everything, there is this new, probably useless gadget.” Couple that with companies like Amazon who make it incredibly easy to buy, try, and return, and you’re left with lots of folks who have -- or have access to -- everything they want or need. So, how do you give the gift of your time? There are a lot of options. My wife likes to bake. She will spend a Saturday making cookies and cakes, and then wrapping them as gifts for important people in her life. I remember my mother doing the same thing when I was growing up. This is a great way to show someone you care. I enjoy raking leaves and shoveling snow, which are two winter chores that many folks do not enjoy. When a neighbor opens the front door to see me clearing her driveway, a simple “Happy Holidays” is the ribbon on the gift of my time. You could play music, do someone’s grocery shopping, repair their leaky pipe, pet- or babysit for a night out. The list goes on. But chances are there is something you like doing that your friends or loved ones do not. Uncover that overlap, and you have yourself a Christmas gift. Nearly 1 in 15 adults are shopaholics. How can someone tell if he or she is a shopaholic? Shopping is a complex psychological activity. Your brain is processing a lot of information, from prices to quality to your personal budget to “Will Nick actually wear this shirt?” Individuals differ on our cognitive abilities and their shopping preferences, which all factor into this question. Let’s look at the word itself by examining similar words. Consider a workaholic or chocoholic. These are people who are addicted to their jobs, work long hours, and gain satisfaction from their careers. A chocoholic is addicted to chocolate or is extremely fond of it. In both cases, these folks get more out of their job or sweets than the average person. Not only that, they crave and almost need it. The same logic applies to a shopaholic. In a sense, a shopaholic is addicted to shopping. They put more into and get more out of shopping than other people. How can you tell if you are a shopaholic? If you’ve ever used the term ‘retail therapy’ you may be a shopaholic. If you enjoy the rush of navigating Black Friday crowds because of the thrill, you may be a shopaholic. If it brings you satisfaction just to browse, you may be a shopaholic. If you treat shopping as a reward, as in “Whew what a rough day, I deserve a new pair of shoes,” you may be a shopaholic. On the other hand, if you treat shopping as a functional task that you have to complete or you dread going to the mall around Christmas, suffice it to say, you are not a shopaholic.
Methodology
In order to determine the cities with the biggest holiday budgets, WalletHub’s analysts compared 570 cities across five key metrics: 1) Income, 2) Age, 3) Debt-to-Income Ratio, 4) Monthly Income-to-Monthly Expenses Ratio and 5) Savings-to-Monthly Expenses Ratio. Our calculation is based on WalletHub’s proprietary algorithm, which takes into account the aforementioned five factors to determine the holiday budget for a particular city.
At a high level, our algorithm considers a consumer to be in a comfortable financial position to engage in holiday spending if they have: 1) enough emergency savings to cover at least six months of expenses and 2) a debt-to-income ratio smaller than 22 percent for a renter or 43 percent for a homeowner. Depending on a city’s specific characteristics, the algorithm adjusts upward or downward to create a custom estimate.
Finally, we use the same algorithm to provide a personal holiday-budget estimate for all WalletHub members between now and Dec. 25.
Sources: Data used to create this ranking were collected from the U.S. Bureau of Labor Statistics, Federal Student Aid, Freddie Mac, Federal Reserve and TransUnion.
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