Black Friday – Visualizing the surge in U.S. consumer debt and spending

The Chart of the Week is a weekly Visual Capitalist feature on Fridays.

Next week, Black Friday and Cyber Monday will kick off the start to the U.S. holiday shopping season, during which consumers are expected to spend a total of $655.8 billion this year.

With the average bill coming in at $938.50 for holiday spending, where are people finding the extra cash?

We looked back at the last five years of Equifax data to see how consumer debt correlates to holiday purchases.

Black Friday

Black Friday

There’s Credit In Store

One way consumers take advantage of Black Friday deals is through the issuance of store credit. Specifically, Black Friday traditionally sees a noteworthy surge in signups to private label cards – the kind redeemed at stores like Macy’s.

Each year, roughly half a million Americans are signing up for new accounts on Black Friday:

Private label cards issued 2012 2013 2014 2015
Prior 10 days (Avg.) 130,312 153,605 164,341 162,006
Black Friday 463,292 485,512 502,805 491,873
Following 10 days (Avg.) 167,144 181,454 182,320 181,903

Furniture and department stores are among the biggest providers of this type of credit to consumers. Here are the five-year averages by industry for the months of November and December:

New store credit issued (Nov/Dec) $ millions
Furniture 851
Department stores 790
Jewelry 451
Electronics 365
Clothing 241

Charge it, please

This bump in activity doesn’t stop with new signups for store credit. The average balances on store cards and credit cards both jump noticeably in the months following the holiday season:

Month Store Card Balance (5-Year Average) Credit Card Balance (5-year Average)
August $291 $1,717
September $293 $1,720
October $296 $1,709
November $298 $1,707
December $313 $1,742
January $320 $1,756
February $308 $1,710

Every year is different, but the data always follows the same trend.

Stocking up on Black Friday deals is not cheap, and extra dollars spent eventually make their way onto the credit card statement with the cost of interest added on.

Article Jeff Desjardins, Visual Capitalist