Grandparents keeping cash alive this Christmas

•    56% of people planning to gift money this Christmas are giving physical cash
•    Older people are more than twice as likely to gift cash than younger generations
•    Two-fifths of people will give gift cards
•    Premium Bonds are as unpopular as Cryptocurrency

Laura Suter, head of personal finance at AJ Bell, comments: 

“Cash is still king for people giving money this Christmas, with it being the most popular monetary gift this festive season. However, people’s likelihood of gifting cash varies dramatically by age and it’s the older generations keeping cash alive. 

“Grandparents slipping their grandkids a fiver in their Christmas card are helping to maintain the trend of giving cash, as 68% of those age 55 to 64 and 62% of those 65 and above are planning to hand over cash rather than a present this year. But stuffing some cash in an envelope isn’t just the refrain of older people, as 72% of those 44 to 54 plan to give physical cash too. In comparison, just a quarter of 18 to 24-year-olds would give cash and only a third of 25 to 34-year-olds. 

“Gift cards are still a popular option, with two-fifths of people planning to hand over a voucher rather than a present this year. Sending a gift card grew in popularity during the pandemic, as people couldn’t meet to exchange gifts for birthdays and Christmas, and gift cards for digital games or spending on digital downloads is becoming more common for children. While this is a great option for the person who has everything or the hard-to-buy-for, as around £100m gift cards or vouchers went unused during lockdown* it might not be the wisest choice. 

“While it might seem unpersonal and you certainly can’t wrap it, a fifth of people are planning to just transfer money into a bank account. It won’t look good under the tree and you can’t even attach a gift message, but it’s a very practical (if impersonal) way to gift money – it can’t get lost like physical cash and it won’t go unused or discarded, like a gift card.

“Premium Bonds, once a more common gift (particularly from grandparents), have waned in popularity, as the interest paid on them has dwindled too. People are now as likely to gift Premium Bonds this Christmas as they are to buy someone Bitcoin – with just 2% of those gifting money planning to do either. Clearly the process for buying Premium Bonds is slightly slicker than transferring crypto, but both are unlikely to make an appearance in most houses this festive season.”

*Based on Which? Figures: https://press.which.co.uk/whichpressreleases/almost-100m-lost-through-unused-shopping-vouchers-during-lockdown-which-reveals/

Of 1,046 people surveyed by findoutnow for AJ Bell on 26 November 2021, 50% plan to give monetary gifts at Christmas. From those respondents: