Consumers Cough up Cash for Little Luxuries
(Daily Finance) — As the economy improves, Americans are beginning to splurge again — but in a small way. Meals at casual sit-down restaurants, a daily cup of gourmet coffee and personal-care services, such as haircuts, hair colorings, manicures and facials, are among the so-called “small luxuries” that are trickling back into Americans’ budgets as job prospects improve and the economy expands, according to a report released last week by the National Retail Federation’s Stores Magazine. Others include department-store purchases, new shoes and even fancy handbags. But Americans remain cautious about big purchases, considering specialty-store items and vacations just about as expendable in 2010 as they were in 2009.
In the NRF’s survey of more than 5,000 adults in December, approximately 42% called haircuts or hair colorings an “untouchable” part of their budget in 2010, up from 37% in 2009. The “untouchability” of manicures and facials also grew by 3 percentage points and 2 percentage points, respectively. Additionally, about 32% of those surveyed said a casual sit-down meal was a necessary part of their budget, up from 29% in 2009, while department-store purchases’ “untouchability” jumped 4 percentage points last year, according to the NRF.