Consumer Spending Trends on Hobbies Amid Rising Costs
A recent report from the Bank of America Institute highlights an interesting trend: American consumers are increasingly dedicating funds to their hobbies, albeit at higher prices.
The report draws on data from Bank of America cards, illustrating the phenomenon of “funflation.” This term refers to the elevated costs consumers face for leisure-related purchases, including items from arts and crafts stores, hobby shops, and outdoor recreation suppliers—think hiking, camping, skiing, and even scuba diving.
According to the findings, spending on hobbies climbed by 7.9% in August compared to the previous year, which is notably higher than the 3.4% increase in the number of transactions. This marks a stark contrast to trends seen in August 2025, where increases in the number of transactions outstripped spending. Interestingly, during the pandemic, spending on hobbies had consistently surpassed transaction growth, reflecting how people turned to hobbies during lockdowns.
The Bank of America Institute suggests that this recent shift could be linked to a post-pandemic recalibration. It seems that as people initially splurged on hobbies while social distancing, they then shifted their disposable income toward pricier options like travel in 2022 and 2023. However, last year, as wage growth post-tax slowed significantly, there might have been a swing back toward more affordable leisure activities.
Concerns Over AI Shopping Agents
While exploring consumer behaviors, the report also hints at possible risks associated with the rise of AI shopping assistants, cautioning about scams, fraud, and data privacy issues that could complicate the shopping experience.
The data reveals a generational divide in how consumers approach spending on hobbies. Older millennials are leading the charge, spending considerably more than baby boomers, Gen X, and their younger counterparts in Gen Z. Interestingly, even younger millennials find themselves in the middle—spending more than Gen Z but less than older millennials. The Bank of America Institute speculates older millennials may be investing in hobbies not just for themselves but also for their children, as they constitute a significant portion of that age bracket.
Shifts in Leisure Time
Another factor worth noting is the leisure time disparity highlighted by the Census Bureau’s American Time Use Survey. It appears that older millennials average just over four hours of leisure each day, indicating a potential reason for their increased hobby spending as both personal and familial interests are pursued.
Conversely, younger millennials and Gen Z seem to exhibit lower average spending but have a higher number of individuals engaging in hobbies. This trend suggests these generations may be predominantly engaging in more affordable hobbies such as arts and crafts or board games.
Funding Hobbies Amid Rising Costs
Exploring the dynamics, the report notes more upcoming spending from the middle-aged group, while baby boomers and Gen Z are pulling back slightly on their hobby-related expenses. In fact, Gen Z’s spending growth nearly flatlined in August, sharply down from approximately 16% the previous year. This decline appears to correlate with reduced spending on outdoor activities, potentially offset by rising consumption at arts and crafts retailers.
The report suggests that last year’s spending, driven by long-lasting outdoor gear purchases, perhaps reflects a shift to simpler, more sustainable hobbies like knitting or baking, referred to as “granny core” activities.
Additionally, Gen Z stands out as the demographic spending the most on gaming—covering both board games and tabletop role-playing games, which typically don’t necessitate frequent purchases. According to the Census Bureau, they also spend a significant portion, about 20% to 25% of their leisure time, engaged in gaming or computer activities.
