TULSA, Okla. — Holiday shoppers are facing a perfect storm of higher prices this season, tariffs and inflation spike up the cost of gifts and entertaining.
A new LendingTree analysis shows that current tariffs would have added an estimated $130 to the average family's holiday spending last year, with consumers nationwide facing an additional $28.6 billion burden on gift purchases this season.
"People really should be prepared to have their holiday budget be a little higher this year," said Matt Schulz, LendingTree's chief consumer finance analyst.
The financial pressure extends beyond tariffs. Bankrate's analysis of holiday essentials found that 78% of tracked items cost more this year compared to last, with prices rising faster than in 2023.
Food and entertaining costs surge
Holiday entertaining is taking the biggest bite out of budgets, with six of the 10 most inflated items being food-related.
"The most expensive items are those sugar and sweets, those candies," said Sarah Foster, Bankrate analyst.
Grocery prices have accelerated over recent months after 16 straight months of more moderate increases, making holiday dinners and parties more costly for families.
Jewelry and musical instruments hit hardest
Gift-givers face steep price increases in specific categories. Bankrate found that 75% of tracked gift items became more expensive this year, compared to just 35% last year.
Watches and jewelry top the list of higher-cost gifts, followed by musical instruments. These increases stem directly from tariff impacts on imports.
"There's only a few jewelers and there's only a few musical instrument manufacturers, so those companies know that they have pricing power, so they're able to really pass along those higher prices from tariffs," Foster said.
Electronics offer relief
Not all categories are seeing price increases. Electronics like smartphones, TVs and computers are actually cheaper this year, providing some relief for holiday shoppers.
The difference comes down to market competition and consumer buying power in these categories, where shoppers can compare prices and stack discounts more easily.
Shopping strategies for savings
Despite higher costs in many categories, consumers can still find deals by shopping around, comparing prices and watching for additional discounts as Christmas approaches.
The LendingTree study found that while consumers face the $28.6 billion tariff burden, retailers are absorbing an estimated $12 billion themselves. Electronics carry the highest per-shopper burden at $186, while clothing and accessories add $82 to average costs.
Personal care items and toys each adding $14 to holiday budgets.
This story was reported on-air by a journalist and has been converted to this platform with the assistance of AI. Our editorial team verifies all reporting on all platforms for fairness and accuracy.
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