American Express research shows Americans ready to spend on little luxuries
Written by Curtis Arnold
Posted On: October 4, 2010
Maybe that really was a limo I saw parked in front of Chipotle the other day. According to American Express, the "ultra-affluent" have fallen in love with quick service, "fast casual" restaurants. The company's latest Business Insights Spend Trends report tracked how its customers used credit cards and charge cards during the second quarter of 2010, with some surprising results.
We're down, but not out. In fact, we're going out to eat.
Perhaps we're eating our feelings, but the American Express research suggests that all this talk of a double-dip recession has finally sent most of us to the ice cream parlor for a double dip of our favorite flavor. Yes, Americans have paid down more debt in the past year than ever before. That could be because half of our credit cards won't let us rack up any new charges. So we're still willing to splurge on the little things that make us happy, and that usually means food.
That's where our ultra-affluent friends come in. They're spending 12% more in fine dining establishments during 2010 than they did a year ago. However, they're swiping their American Express cards 24% more often in quick service eateries like Panera and Potbelly. That's not counting the proliferation of foodie-style food trucks we're seeing in every major city. In this economy, even those of us on expense accounts want to find value for money. And who can't find value in a $7 burrito, even if your driver has to circle the block for a second helping of guac?
You might have a better couch to crash on if the recession double-dips.
Statistically, we're out of the recession. But Americans have remained cautious about spending on essentials. It's good news, then, that the credit card expenses tracked in American Express' survey show at least a 9% increase in spending on quality furniture and home goods. If the market's too slow to sell your home, it seems totally appropriate to make yourself comfortable. And if loved ones or college chums need to stay at your home instead of at a hotel, a handy sofa bed sounds like a solid investment.
Curtis Arnold, a nationally recognized consumer educator and advocate, has been educating consumers about credit cards since 1998. Curtis is the author of "How You Can Profit from Credit Cards: Using Credit to Improve Your Financial Life and Bottom Line" (FT Press, 2008). He is also the co-author of the upcoming Complete Idiot's Guide to Person-to-Person Lending (Alpha Books/Pengiun Group USA, April 2009), a contribitor to The Ultimate Allowance (InnerWealth Publishing, 2008) and is extensively featured in 42 RulesTM for Driving Success With Books (Super Star Press, January 2009).