33% of Shoppers are Increasing Their Debt This Holiday Season

While holiday shoppers are showing signs of decreased spending and more control of unhealthy spending habits, 33% of shoppers are still planning to increase their debt this holiday season.  According to a Accenture’s annual holiday consumer spending report, survey results show that consumer expect to spend an average of $582 on their holiday shopping lists and 23 percent plan to spend more than $750.  Over half (52%) expect to increase their spending from last year by $250 or more.

The good news is that according to the survey, most shoppers are better prepared for their spending this year than they were last year, with 51% saying they will pay cash for their purchases.  However, there is still a large number of consumers who state that they will put their purchases on a major credit card—33%, in fact.  This is still one-third of consumers who plan to add to their consumer debt this holiday season. 

According to Chris Donnelly, managing director of Accenture’s Retail practice, “The research illustrates a shift in U.S. consumers’ approach to their holiday spending.  Many consumers are still struggling to balance their household budgets, at the same time that pay raises and bonuses remain in short supply, and they are realizing that this is not a short-term phenomenon.  Consumers will remain resistant to the impulse purchase, and retailers will have to work harder to secure that extra spend by having a unique product, service or experience, and being clear on the value to the customer.”

Some of the ways consumers are coping with having less money to spend and attempting to spend money more wisely include an increased amount of online shopping, where items can often be found at better prices.  Shoppers are also taking more advantage of discounts and promotions offered by retailers in an attempt to lower their overall spending during the holiday shopping season. 

What is the current situation with student loans in default in the United States this year?

Even More Reasons to Work with a Responsible Collection Firm

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There are plenty of reasons why choosing to work with a responsible collection firm is a wise decision. Not only are responsible collection tactics less distasteful than the “thug tactics” employed by many collection agencies, but relatively respectful collection tactics are more likely to produce favorable outcomes with your debtors as well. There’s a third, even more important and even more practical reason to choose a collection agency that does NOT utilize inappropriate tactics- there are laws against the most common debt collection harassment tactics.

At a very base level a collection professional needs to be polite and respectful to the debtors they speak with. Collection agents aren’t allowed to bully or otherwise act in an excessively rude manner to the debtors on their lists. While a collection professional isn’t likely to be reported if they speak in a manner a debtor considers “rude” or “disrespectful,”such a manner will hurt your case if your debtor’s account goes to court.

One of the most common forms of harassing behavior utilized by debt collectors is a continuous string of phone calls at inappropriate times. Now, there’s nothing wrong, illegal or immoral about calling a debtor about the money they owe. But legally speaking a collection agent can only make these calls during a range of hours that have been clearly defined according to state and federal law. The laws dictating when a collection agency can call a debtor differ from state to state, and if an agent repeatedly makes calls during prohibited hours they can be sued for harassment.

Harassing behavior does more than simply lower the chances you will collect from your debtors- it gives your debtors legal ammunition to use against you. 

Why Consumer Debt is the Biggest Threat to Your Business

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If you’re a business owner then you likely feel besieged at all times, from all sides, by threats to the organization you’ve crafted and cared for. None of these threats should be discounted, yet some of these threats are more dangerous than others. It’s natural to feel your direct competition, or changing technology, is the biggest threat to your business. But ultimately the biggest threat to your business is consumer debt.

Consumer debt threatens your business in a variety of ways. From a “big picture” viewpoint consumer debt threatens your business because it threatens the larger economy which you operate within. High levels of consumer debt lead to unstable economic conditions, which lead to conservative policies within banks, the same banks whose loans you rely on to expand your business.

Taking the scale of the discussion down a notch, consumer debt is also dangerous to your business because large-scale consumer debt can reduce consumer purchases of goods and services, including your own. After consumers reach a certain level of debt they simply stop buying non-essentials, and this is especially true during hard economic times where lots of people are either out of work or have had to take on pay cuts.

But on a more 1-to-1 level, consumer debt is an incredible threat to your business if you allow your consumers to open up lines of credit with your company. It might sound like a good idea to open up lines of credit with your customers, doing so provides you with both the initial sale and the miracle of compound interest, but what happens when your customers stop paying that debt? What happens when they default on the debt they accrued with your organization?