How much holiday debt do you expect this year? The survey shows that it varies by age group

What’s causing you to squeeze your holiday funds this season?

Ideally, the holidays will be a time of peace and happiness. But for many American adults, it leads to overspending, difficulty managing debt, regret, and financial anxiety.

79% of 2,084 adults surveyed by Harris on behalf of the American Institute of Certified Public Accountants (AICPA) said they will use credit cards to pay for gifts and travel this holiday season. Strikingly, nearly half (52%) don’t expect to pay off the balance in full when the bill arrives, and 17% said it will likely take more than six months for them to pay off the debt.

A quarter of holiday shoppers said they usually set a budget for the period but find it difficult to stick to it, and 39% of respondents said they later regretted their overspending during the holidays.

The solution seems simple: just spend less. As many Americans will tell you, this is easier said than done.

Young people are more likely to overspend and anticipate post-holiday debt

This stressful financial habit is not uniform across all age groups. According to survey data, younger adults are more likely to engage in debt-fueled spending during the holiday season.

Why do young people tend to struggle more with managing their finances? This is partly due to limited life experience, which can translate into fewer opportunities to learn financial skills. Another factor may be that younger adults generally devote more time to social media, which can lead to emotional spending or fear of missing out.

Ways to avoid holiday spending hangovers

To avoid turning a joyful season into a source of stress, make a plan.

“When spending is driven by emotion rather than plan, it can get out of hand,” says Dan Snyder, director of personal financial planning at the AICPA. “Leaving impulsive spending unchecked, whether it’s on gifts, travel or entertainment, can lead to a serious financial drain. Having a plan can help spenders start the new year while maintaining their financial soundness.”

What does this plan entail? According to the AICPA, a good starting point is to use the following guidelines.

• Set a budget and stick to it: The AICPA recommends taking the time to decide who you want to buy gifts for and how much you will spend on each gift before you start shopping. It’s also important to track your spending on the go to make sure you stick to your budget.
• Explore ways to reduce travel costs: Book travel in advance and be flexible with dates to secure better deals. And try using points earned on credit cards to save money on flights, hotels or car rentals.
• Keep credit card debt to a minimum: Pay off credit card balances in full, or as soon as possible if that’s not possible. If you have unpaid balances on multiple credit cards, the AICPA advises that you prioritize paying off the card that charges the highest interest rate while continuing to pay the minimum on your other cards.