Introduction
As the holiday season approaches, younger consumers are taking a markedly different approach to their gift budgets. According to a recent report by the New York Post, Gen Z plans to spend 34% less on gifts this year than in previous years as rising prices and shifting priorities reshape how this generation celebrates the season. New York Post
This trend points to a broader transformation in holiday spending, reflecting a mix of economic reality and changing values. In this article for Epsy Magazine, we take a closer look at what’s driving Gen Z’s reduced gift spending, how it aligns with broader consumer behavior, and what it could mean for retailers and family traditions.
The Numbers Behind the Shift
Research cited in the New York Post highlights that:
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Gen Z — typically defined as those born between 1997 and 2012 — intends to spend 34% less on gifts this holiday season compared with past years. New York Post
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The trend reflects a combination of economic pressures and evolving priorities around holiday celebrations.
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Rising prices in popular gift categories, such as electronics, kitchen goods, and clothing, have contributed to what many shoppers view as “holiday sticker shock.”
For instance, products like Beats Solo 4 headphones and air fryers have become significantly more expensive year-over-year, illustrating how inflation in everyday retail categories can dampen enthusiasm for traditional shopping. New York Post
Why Gen Z Is Cutting Back on Gift Spending
There are several interlinked reasons why Gen Z plans to spend 34% less on gifts this year:
Economic Pressure and Personal Finances
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Many Gen Z adults carry significant personal debt, with average balances reaching nearly $3,000, creating pressure to prioritise financial stability over discretionary spending. New York Post
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Inflation has outpaced wage growth in many sectors, meaning everyday essentials absorb more of monthly income. This trend is also reflected in broader holiday spending patterns, where consumers across generations are tightening budgets. CouponFollow
Prioritising Experiences Over Material Items
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Gen Z respondents are reportedly more likely to value time spent with friends and family rather than purchasing physical items, opting instead for shared experiences like holiday events, concerts, and festive outings. New York Post
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A separate analysis from Forbes indicates younger shoppers are placing greater emphasis on community, nostalgia, and meaning in holiday celebrations rather than on traditional materialism. Forbes
Broader Consumer Trends
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The movement toward experiential gifts isn’t unique to Gen Z. Data suggests that across the U.S., a significant portion of consumers are open to non-traditional gift formats, such as event tickets or quality time activities. CouponFollow
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This reflects a broader “value spending” mindset for 2025, where shoppers are more thoughtful about where they allocate limited budgets. CouponFollow
What This Means for Retailers
Retailers planning for the 2025 holiday season must navigate these shifts carefully. Traditional gift-centric models may see less traction with younger consumers who:
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Seek value and emotional resonance rather than volume of gifts
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Use price-comparison tools and leverage sales more aggressively
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Are more likely to consider second-hand or upcycled options to stretch budgets The Daily Upside
Some successful retail strategies this year are likely to include:
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Bundled experiences
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Gift cards and service-based offerings
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Promotions highlighting value and long-term use
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Partnerships with experiential brands (travel, education, entertainment)
Such approaches may better resonate with Gen Z shoppers and other budget-conscious consumers.
How Families and Traditions Are Evolving
While economic pressures are a clear driver, changes in spending also reflect a broader shift in holiday norms.
Younger adults increasingly:
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Value presence and quality time over physical gifts
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Embrace DIY or meaningful personalised gifts
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Resist the pressure to “keep up” with lavish purchases
This trend is echoed in broader research showing seasonal shoppers are recalibrating expectations and focusing on moments and experiences over traditional consumption. CouponFollow
Generational Spending Comparisons
Though Gen Z plans to spend significantly less on gifts, other generations are showing varied patterns:
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Millennials and older cohorts are adjusting holiday budgets too, but not as sharply as Gen Z. CouponFollow
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Broader holiday surveys suggest overall consumer spending will dip modestly, with gift purchases taking a larger share of these reductions. CouponFollow
These shifts underline how economic and cultural influences are reshaping holiday traditions across age groups.
Conclusion
The news that Gen Z plans to spend 34% less on gifts in 2025 reveals more than a simple budget adjustment — it reflects evolving priorities, economic realities, and a deeper appreciation for experiences over material items.
For families, retailers, and cultural observers alike, this trend signals a shift in holiday mindsets. Instead of focusing purely on gift lists and price tags, holiday celebrations in 2025 are likely to prioritize meaningful moments, intentional spending, and creative engagement with loved ones.
At Epsy Magazine, we continue to track how generational attitudes and economic forces intersect with cultural traditions and consumer behaviour.