According to TD Bank's annual Merry Money survey, Gen Z shoppers are the most financially disciplined and tech-wise age group, with 88% taking steps to limit seasonal overspending and 51% using AI to make a holiday budget

While most U.S. consumers have money on their minds as the holiday season approaches, one cohort is especially deliberate about staying on budget – Generation Z.

According to TD Bank's 2025 Merry Money survey, which polled over 2,500 U.S. consumers on their holiday shopping and spending habits, most (88%) respondents born between 1997 and 2007 are considering ways to limit overspending. Among Gen Z adults, 77% are planning to make a holiday budget this year, and half (51%) of these respondents are planning to do so with Generative AI, highlighting an inclination by this generation of shoppers to adopt new strategies to stay on budget as seasonal spending ramps up.

“Gen Z has grown up amid global economic uncertainty, and that may help explain why they demonstrate such strong financial awareness,” said Marc Womack, Head of U.S. Consumer Deposit & Payment Products at TD Bank. “They’re redefining seasonal spending and taking advantage of technologies that help them blend traditional budgeting and saving habits with solutions like credit card rewards optimization apps and AI-enabled tools. This is a group of shoppers who are balancing financial discipline with a bit of holiday indulgence.”

Gen Z Shoppers are Anxious, Intentional and Strategic about Holiday Purchases

Among Gen Z respondents, nearly two-thirds (65%) admit that the financial aspect of the holiday season makes them anxious – perhaps why six in ten (60%) of this age group plan to spend less this holiday season due to tariff concerns, demonstrating a deliberate approach to managing costs and staying on budget. By comparison, Gen X (72%) and Millennials (71%) are more likely to overspend during the holidays than their Gen Z (60%) counterparts.

They’re also approaching holiday spending with intention, with nearly nine in ten Gen Z (90%) and Millennial (87%) respondents planning their purchases around major shopping events and holidays like Black Friday and Cyber Monday to maximize deals. Young shoppers are making an overall shift toward strategic, discount-driven shopping for the holidays, timing their purchases to make every dollar count.

Gen Z’s financial habits for the holidays also reveal a mindset focused on long-term goals rather than short-term splurges. This generation isn’t just budgeting to avoid overspending, but rather to save for future priorities:

• Twenty-four percent (24%) of Gen Z consumers surveyed are putting money aside for a major purchase in 2026.
• Twenty-one percent (21%) are planning ahead for travel or upcoming vacations, roughly double the share of Gen X shoppers (11%) doing the same.
• Fourteen percent (14%) are saving up for major life milestones such as weddings, relocations or new jobs.

Purpose and Connection Drive Holiday Spending Trends

Consumers are also leaning toward more meaningful ways to celebrate this year. Forty percent of Americans surveyed plan to gift experiences this year, with dinner or an evening out topping the list (55%), followed by spa or self-care days (31%) and travel or weekend getaways (30%). Younger generations are far more likely to give any type of experiential gift, with 61% of Gen Z and 54% of Millennial respondents planning to do so, compared to 36% of Gen X and just 18% of Baby Boomers. In particular, Gen Z and Millennials are more inclined to gift experiences such as travel, concert or event tickets, personalized experiences, annual memberships/passes and fitness classes.

Beyond gifts, nearly half (44%) of respondents expect groceries and family meals to be their biggest holiday expense, signaling that consumers continue to prioritize meaningful traditions and time together.

Consumers Embrace Seasonal Saving – and Spending

This year’s data illustrates cautious confidence and thoughtful preparation, with two-thirds (67%) of shoppers surveyed planning to set a holiday budget and six in ten (59%) expecting to spend under $600. Nearly eight in ten (79%) respondents are actively seeking out coupons, sales and deals to manage costs, underscoring how shoppers are prioritizing smart spending. And while most (82%) feel confident in managing their holiday expenses, over half (52%) are planning to spend less due to tariff concerns.

For many, the spirit of saving and planning starts before the immediate shopping season, as around half (53%) of consumers surveyed have been setting aside money throughout the year to prepare for holiday expenses, suggesting lessons of recent inflationary years have had a lasting effect on financial habits.

Consumers’ financial discipline also remains strong once the holidays wrap up, with six in ten (60%) respondents expecting to pay their balances in full by January 2026, underscoring a healthy post-holiday repayment mindset.

“Holiday preparation starts well before the first gift is wrapped,” Womack added. “This year we’re seeing that consumers are planning earlier, saving consistently and approaching the season with a greater sense of financial control. From setting money aside throughout the year to paying balances off quickly after the holidays are over, shoppers are proving that good preparation is just as important as smart spending.”

How Americans Shop for the Holidays

Online purchases continue to dominate holiday shopping, with nearly three-quarters (73%) of respondents saying they plan to purchase gifts on Amazon. However, traditional habits are far from disappearing, with 53% still looking for the in-person experience of malls and brick-and-mortar stores for their holiday purchases.

While nearly all (89%) of respondents said they have a credit card, only 31% prefer to use it for their holiday spending. Instead, nearly half (47%) said they prefer to use their debit card while buying gifts.

"A rewards credit card is a great way to earn on your purchases," said Chris Fred, Head of Credit Cards and Unsecured Lending at TD Bank. "Take a look at your available credit cards and see which offer the best rewards for the categories you are planning to purchase in. You can redeem rewards to help with holiday travel or use cash back rewards to maximize your holiday budget."

Among those planning to use a credit card this holiday season, nearly three-quarters (72%) planning to apply their credit card rewards to their holiday spending.

Additionally, technology is playing a growing role in how shoppers prepare for the holiday season, with one-third of consumers planning to use Generative AI for gift ideas (33%) or for creating their holiday budget among those who plan to make one (36%).

Methodology

This online CARAVAN survey was conducted by Big Village among a sample of 2,521 U.S. adults ages 18+ who celebrate the holidays. This survey was conducted from October 14-21, 2025.

About Big Village

A Bright Mountain company, Big Village is a modern business intelligence partner with a long and storied history in the insights industry.

Big Village is a research and analytics business that helps brands and agencies to better understand customer behavior, intentions, and attitudes to drive effective marketing and innovation. We provide fast-track learning and human-led decision support to help brands genuinely commit to knowing their customers and succeed. Known for decades as Opinion Research Corporation (ORC), we have over 80 years of experience in delivering high-quality data and insights. Today, we design, build, and manage consumer insights projects and programs that enable always-on learning and generate growth for brands.

Find out more at https://big-village.com.

About TD Bank, America's Most Convenient Bank^®

TD Bank, America's Most Convenient Bank, is one of the 10 largest banks in the U.S. by assets, providing over 10 million customers with a full range of retail, small business and commercial banking products and services at approximately 1,100 convenient locations throughout the Northeast, Mid-Atlantic, Metro D.C., the Carolinas and Florida. In addition, TD Auto Finance, a division of TD Bank, N.A., offers vehicle financing and dealer commercial services. TD Bank and its subsidiaries also offer customized private banking and wealth management services through TD Wealth^®. TD Bank is headquartered in Mount Laurel, N.J. To learn more, visit www.td.com/us. Find TD Bank on Facebook at www.facebook.com/TDBank and on Instagram at www.instagram.com/TDBank_US/.

TD Bank is a subsidiary of The Toronto-Dominion Bank, a top 10 North American bank. The Toronto-Dominion Bank trades on the New York and Toronto stock exchanges under the ticker symbol "TD". To learn more, visit www.td.com/us.

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Gen Z’s financial habits for the holidays reveal a mindset focused on long-term goals rather than short-term splurges.