Oct 24, 2026
Holiday budgets are shrinking, but the pressure on them isn’t. Canadians plan to trim about $64 off their holiday spending compared to last year, with over half admitting that the economy and inflation are casting a shadow over the season.
At the same time, many households are pinning their plans on a handful of sale days. Black Friday falls on Nov. 27 this year, and plenty of shoppers have been holding out for months just to score deals.
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That strategy can work. But a budget built around discounts only stretches if the discounts are real, and if the bill doesn’t follow you into the new year.
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How much are Canadians planning to spend on the holidays this year?
Canadians are planning to spend about $911 this season — a noticeable drop from the $975 average in 2025. That’s according to the 2026 Holiday Shopping Survey from the Retail Council of Canada (RCC), a not-for-profit association representing retailers, and Leger, the largest Canadian-owned market research firm.
The pullback is most severe in Ontario, where planned holiday spending fell by $143, or 13%, to average $952. British Columbia follows at $993, down 12%. Alberta takes the top spot with the biggest budget at $1,184, while Quebec and the Prairies are the only regions actually planning to spend more this year.
Inflation and higher prices are the top factor shaping spending plans, cited by 48% of respondents. Among those feeling the pinch, nearly half plan to spend extra time hunting for deals, while 39% are setting a strict budget.
Present buying is consuming more of the budget, now claiming 86% of planned spending compared to 79% last year. Many Canadians are cutting back on themselves, not on the people they love.
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Why does inflation still feel heavy if grocery prices are cooling?
Grocery inflation has eased, but other costs are biting. Canada’s annual inflation rate rose to 3.1% in September from 3.0% in August, according to the latest Consumer Price Index from Statistics Canada, the country’s national statistical agency.
Gasoline costs jumped 27.8% compared to last year, and fuel oil leaped 57.8%. That hit Atlantic Canada hardest, where home oil heating is much more common.
Grocery prices rose 1.7%, the slowest pace since May 2024. Still, they remain 33% higher than in September 2020. Holiday meals, hosting and travel all draw from the same pot as gifts.
Is a Black Friday ‘deal’ always a good deal?
Does waiting for Black Friday guarantee you’ll score a better deal? Not necessarily. The day is the centrepiece of most holiday plans: 88% of Canadians rank it among their top three shopping days, and 43% hold off on purchases all year for big sales. Black Friday and Cyber Week are tied for top spot, with each taking about 29% of holiday budgets.
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Waiting only works if the deal is legit. Last November, the Competition Bureau, an independent federal law enforcement agency, warned retailers after a surge in complaints about inflated “regular” prices. Under consumer law, an original price must reflect real sales history, and retailers need the receipts to prove it.
The Bureau also targets drip pricing, which means advertising a low price and then adding mandatory fees at checkout. Unless it’s an official tax, adding extra fees like that is illegal.
Should you spread holiday costs with buy now, pay later?
Breaking up a big expense into instalments can help with cash flow, but at the end of the day, it’s still borrowing money. Guidance from the Financial Consumer Agency of Canada (FCAC), the federal agency that oversees federally regulated financial institutions, notes that a buy now, pay later (BNPL) plan finances your purchase with credit. Promotional rates can be tempting, but always read the fine print so you know what the price jumps to when the deal ends.
The same logic applies to credit cards. If you can’t pay off the balance when that January bill hits, interest costs will quickly eat up whatever you saved on sale.
What to do now
With five weeks until Black Friday, a little preparation goes a long way:
- Create one total holiday budget that includes food, entertaining and travel expenses alongside your gift spending
- List the items you’re waiting for and note their prices now, so you can recognize a real discount
- Use price tools, but always compare the final total at checkout, fees included
- Report suspicious “regular” prices or surprise fees to the Competition Bureau
- Pay with cash or a card you can clear immediately, and always read the fine print on BNPL plans
- Put loyalty points and rewards toward gifts before reaching for credit
It’s not about spending the absolute least; it’s about making every dollar work for you. Most Canadians already lean that way: 53% say a memorable or meaningful gift matters more than the lowest price.
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Amy Tokic is an SEO content editor for Money.ca. She holds a B.A. in Communications from the University of Windsor. Amy is an award-winning author and has been writing professionally for 15 years, publishing articles in the lifestyle and health sectors.
