Consumers say they will spend more than ever on graduation gifts this year as they stuff greeting cards with gift cards and cash, according to the annual survey released today by the National Retail Federation and Prosper Insights & Analytics.
With more consumers buying for graduates this year – 36 percent compared with 34 percent in 2016 – total spending is expected to reach $5.6 billion. That’s the highest number in the survey’s 11-year history, topping last year’s previous record of $5.4 billion.
“As students mark the end of one chapter in their lives and start the next, friends and family will help prepare them for this new journey,” NRF President and CEO Matthew Shay said. “From gift cards to clothing and electronics, retailers will have their shelves stocked with a variety of options.”
Cash will once again be the most popular gift, given by 53 percent of those surveyed as they seek to help students with the costly transition from high school to college or college to the “real world.” However, cash gifting is at a survey low in 2017, dropping about 10 percent from highs recorded in 2007 and 2009. Greeting cards follow at 41 percent, gift cards at 33 percent, apparel at 16 percent and electronics at 11 percent.
“This graduation season we are seeing more young Millennials giving gifts to their peers,” Prosper Principal Analyst Pam Goodfellow said, noting that 48 percent plan to do so, up from 42 percent last year. “While greeting cards are most likely to be exchanged among 18-24-year-old, gift cards, cash, and apparel are other popular options. In fact, this group is nearly twice as likely to gift clothing than the overall average.”
While ages 18-24 are the most likely to give a gift to graduates (at 48 percent), they maintain the smallest budgets at $78.42. The biggest spending is likely to come among parent-age 45-54-year-olds at $119.84 as well as those in the grandparent bracket of 65+, who plan to spend an average $112.34.
The survey, which asked 7,335 consumers about their Graduation gifting plans, was conducted May 2-9 and has a margin of error of plus or minus 1.2 percentage points.