The Financial Aftermath of Holiday Cheer: Navigating Spending in the Digital Age

As holiday shopping reaches its peak, a concerning trend is emerging for many American consumers. Recent research conducted by Talker Research on behalf of Affirm reveals that a significant portion of holiday shoppers may be setting themselves up for financial challenges well into the new year. Of the 2,000 Americans surveyed who celebrate winter holidays, 35% plan to use credit cards for their holiday purchases. What’s troubling is that only a small fraction—just 17%—consistently pay their credit card bills in full to avoid interest charges. The consequences are sobering: 70% of credit card users anticipate carrying their holiday debt into 2026, with nearly one in five expecting to still be making payments on these purchases by next summer or later. This extended payment timeline doesn’t just stretch the holiday season financially—it dramatically increases the actual cost of gifts through accumulated interest and fees.

The financial impact of these payment decisions extends far beyond the holiday season. “The issue isn’t just timing, it’s cost,” explains Vishal Kapoor, Head of Product at Affirm. “Credit card interest that compounds month to month can make purchases significantly more expensive over time.” This reality has caught many shoppers off guard in previous years, with 47% of respondents admitting they’ve been surprised by how much interest and fees increased their holiday spending costs. Despite these challenges, the survey reveals that most Americans still strive to be thoughtful with their holiday spending. The two most common shopper personalities identified were “The Giver” (35%)—those who aim to be generous while staying realistic about their budget—and “The Planner” (27%)—those who meticulously create lists, set budgets, and stick to them. These findings suggest that most holiday shoppers aren’t deliberately reckless with their finances but may lack the tools or clarity to make fully informed decisions.

Technology is increasingly playing a role in how consumers approach their holiday shopping strategies. The survey indicates that 44% of Americans have used or plan to use artificial intelligence tools to assist with their holiday shopping decisions. This trend shows a significant generational divide, with 60% of Gen Z and 55% of millennials embracing AI shopping assistance, compared to only 39% of Gen X and 21% of baby boomers. Those who do leverage AI do so for practical reasons: 46% use it to save time, 45% to stay on budget, and 37% to discover more meaningful or creative gifts. Perhaps most surprisingly, among those who use AI for shopping guidance, an overwhelming 89% express trust in the recommendations they receive. This suggests that AI tools may be evolving from novelties to trusted shopping companions, particularly for younger consumers who grew up in the digital age.

The research highlights a strong consumer desire for transparency in holiday shopping costs. When asked how they would feel if every purchase clearly showed its total cost over time, 44% of respondents said they would feel more confident, while 39% indicated they would feel relieved. These emotions reflect the anxiety many shoppers experience when uncertain about the true cost of their purchases over time. The psychological impact of financial clarity extends beyond just feeling better about spending—it fundamentally changes how consumers approach their purchasing decisions. If given the ability to choose exactly how and when to pay at checkout with complete transparency, 40% of shoppers believe they would feel more confident about their spending, and 32% indicated they would plan their purchases more thoughtfully in advance. This suggests that payment flexibility combined with cost transparency could lead to more mindful consumer behavior.

“Shoppers are telling us something simple: they don’t want holiday bills to come with surprise costs,” notes Vishal Kapoor. “When people know exactly what they’ll pay upfront—with no hidden fees and no compounding interest—they feel more confident and in control.” This confidence enables consumers to make spending decisions aligned with their actual budgets rather than reacting to unexpected costs after purchases are made. The survey results paint a picture of modern consumers who aren’t necessarily averse to spreading payments over time, but who strongly desire predictability and transparency in those payment arrangements. As the holiday shopping season continues, these findings suggest that financial services offering clear payment terms may help shoppers avoid the common pattern of post-holiday financial regret. By providing upfront clarity about total costs, payment timeframes, and interest implications, financial tools can help transform how consumers approach not just holiday spending, but their overall financial wellness in the coming year.

As we look toward 2026, the message from consumers is clear: the joy of giving shouldn’t be followed by months of financial stress. While spreading payments over time can make holiday shopping more manageable, the hidden costs of traditional credit can turn seasonal generosity into long-term financial burden. With the right combination of planning, technology assistance, and transparent payment options, consumers can enjoy the holidays without compromising their financial future. This evolving approach to holiday spending reflects a broader desire among Americans to maintain thoughtful generosity while exercising greater control over their financial wellbeing.