With lines wrapping around stores and empty shelves, it seems that the holiday season really is “the most wonderful time” for the American consumers. As part of the season that is traditionally filled with giving, individuals head to stores in order to get their friends and loved ones the perfect gift. However, these aren’t the only people receiving a gift. As the consumer spending grows, so do the pockets of investors.

The bright lights of the holiday season highlight the trends of the American consumer. In 2016, the total holiday retail sales during November and December increased 4% from 2015, exceeding National Retail Federation’s (NRF) initial forecast of $655.8 billion. The American consumer is spending more money each year for the past few years and is a trend that has continued into 2017.

During the period between Thanksgiving and cyber Monday, which is the Monday immediately following the holiday, more than 174 million Americans shopped in stores and online, exceeding the estimated 164 million estimated shoppers (NRF). This trend is expected to continue as the end of the year approaches. This Holiday season the retail sales in November and December are expected to increase between 3.6-4% for a total of $678.75 billion to $682 billion up from $655.8 billion last year (NRF).

As consumers continue to buy more each year, usually those who benefit most are those who’ve invested in the companies that show the biggest profits. This can be good for the investor and the company, but if the consumer spending goes unchecked for too long, the long term effect on the economy can turn negative.  Consumer confidence can turn into consumer debt. According to The Federal Reserve Bank’s Quarterly Report on Household Debt and Credit, as of September 30, 2017, total household indebtedness was $12.96 trillion, a $116 billion (0.9%) increase from the second quarter of 2017 and overall household debt is now 16.2% above the 2013Q2 trough.

According to Go Banking Rates, more than half of Americans have less than $1,000 in savings in 2017. Vanguard Investment Group suggests that individuals should have enough money in their emergency fund to cover at least 3 to 6 months’ worth of living expenses. It is wise to follow this advice should they come upon a rainy day. The holidays can still be enjoyed without breaking the bank. Sharing baked goods, singing carols, and enjoying each other’s company creates memories that last just as long.