CIBC Poll: Budget Conscious Canadians planning to use Debit and Cash this Holiday Season

Most Canadians plan to spend the same or less on the holidays this year, while many admit savings plans are harder to keep up with in December

TORONTO, Nov. 21, 2011 /CNW/ - A new CIBC (TSX: CM) (NYSE: CM) Poll conducted by Harris/Decima reveals 65 per cent of Canadians are planning to stay on budget by using cash or debit to pay for the majority of their holiday spending this year.  The poll also revealed the vast majority of Canadians (87 per cent) are planning to keep their holiday shopping expenses the same or lower versus last year.

Highlights of the poll on how Canadians plan to pay for the majority of their holiday shopping this year include:

  • 36 per cent plan to use their debit card
  • 29 per cent plan to use cash
  • 31 per cent plan to use their credit card

"Planning to use cash and debit to pay for holiday shopping is one way Canadians can ensure they keep track of their budgets and manage their spending," said Colette Delaney, Senior Vice-President, Mortgage, Lending, Insurance and Deposit Products, CIBC. "While Canadians say they are budget conscious this year, nearly 30 per cent of respondents admit they find it difficult to stick to their regular savings plan during the holiday season. Keeping on top of holiday spending is critical to staying on track towards your financial goals and starting the New Year with your savings plan in good shape."

While cash and debit combined were favoured by Canadians for holiday spending, a number of Canadians will be using their credit card to pay for the majority of their holiday shopping (31 per cent).  The good news is most Canadians planning to pay with credit also have a plan to quickly pay off their holiday spending in full (76 per cent) while only 23 per cent of Canadians using credit said they will pay their balance off over time.

The poll also revealed that a majority of Canadians who said they plan to use their credit card to pay for their holiday purchases said they are doing so because they collect reward points (57 per cent) or for convenience (62 per cent).  In fact, 15 per cent of all Canadians said they plan to redeem their reward points to help cover some of their holiday expenses.

"Having a plan that covers your holiday spending allows you to pay for your purchases right away with cash or debit, or benefit from rewards on your credit card knowing you have the funds to pay towards your balance on your next statement," added Ms. Delaney.

"Whether you choose to use cash, debit or credit, there are ways to track spending to help you stay within your budget and keep up with your regular savings plan," added Ms. Delaney. "December is a more expensive month than usual for most Canadians, which makes it even more important to stay on top of your spending so you can keep up with your monthly savings plan."

To help manage holiday expenses, CIBC offers the following tips:

Stay on Top of Cash or Debit purchases: Canadians planning to use cash or debit can track their spending by using the free CIBC Mobile Banking App on their smartphone. Having the CIBC Mobile Banking App on your smartphone allows clients to check their balance and see what they've spent so far that day, in just a few seconds.   

Have a Plan for Credit Card purchases:  Canadians planning to use a credit card to pay for their holiday expenses should make sure they have a plan to pay off their balance to avoid incurring interest charges. With a plan in place, you can earn rewards for your purchases that may save you money on other items, such as discounts on gas purchases or cash back. For example, this year CIBC estimates it will reward clients with $85 million in Dividend Dollars on their December statements, up from $78 million in 2010.  This cash-back reward can be used to help off-set your holiday shopping, or set aside for savings. Other options include the CIBC Petro-Points MasterCard which allows Canadians to earn a discount of up to 7 cents per litre on gas purchases.

Shopping Online or South of the Border: With the added benefit of Visa Debit, you can use the CIBC Advantage Debit Card to shop in the U.S., internationally and at participating online retailers where Visa cards are accepted.  Plus as always, you can use this same debit card to shop at stores in Canada where Interac debit is accepted.

Manage and Track Credit Card Spending: Managing cash flow effectively is a key element in sticking to your holiday budget.  Free services like CIBC CreditSmart can help Canadians stick to their budget. Free to CIBC credit card holders, CIBC CreditSmart allows clients to set a budget limit on each spending category on their credit card, and be notified by phone, email or online message when they exceed their customized budget.

KEY POLL FINDINGS

Percentage of Canadians that plan to use cash or debit to pay for the majority of their holiday spending by region:

Atlantic Canada    68%
Quebec     69%
Ontario     67%
Manitoba/Saskatchewan   67%
Alberta         60%
British Columbia    53%

Percentage of Canadians that plan to use their credit card to pay for the majority of their holiday spending by region:

Atlantic Canada    30%
Quebec     28%
Ontario     31%
Manitoba/Saskatchewan   29%
Alberta      31%
British Columbia    41%

* where totals do not add to 100 per cent respondents were either uncertain or did not select one of the options

*Each week, Harris/Decima interviews just over 1000 Canadians through teleVox, the company's national telephone omnibus survey. These data were gathered in a sample of 864 Canadians who know how much they will spend over the holidays this year between November 3rd and 10th, 2011. A sample of this size has a margin of error of +/-3.3%, 19 times out of 20.

CIBC is a leading North American financial institution with nearly 11 million personal banking and business clients. CIBC offers a full range of products and services through its comprehensive electronic banking network, branches and offices across Canada, and has offices in the United States and around the world. You can find other news releases and information about CIBC in our Press Centre on our corporate website at www.cibc.com.

For further information:

Kevin Dove, Senior Director, External Communications and Media Relations: (416) 980-8835 or Kevin.dove@cibc.ca