South Korea has ranked fourth globally for monthly splurge spending, according to new findings from the Deloitte Consumer Signals Link Index. The report reveals that Koreans spend an average of US$59 per month on discretionary purchases, well above the global average of US$41 across the 20 countries surveyed.

This high rate of splurge spending is largely driven by indulgence in premium alcoholic beverages, alongside spending on fashion, self-care, and hobbies. Korea’s position places it behind only China (US$143), the United Arab Emirates (US$127), and Saudi Arabia (US$121) in the rankings.

Premium alcohol leads the splurge categories

According to Deloitte’s data, 31% of monthly splurge spending in Korea is directed toward food and beverages, with premium alcohol making up a significant portion of that figure. This category alone accounts for three to four times the level of spending typically seen in household goods.

Clothing and accessories came in as the second-largest category, accounting for 29% of total discretionary spend. Self-care represented 10%, underscoring a broader trend of personal wellness and lifestyle focus among Korean consumers.

The motivations behind this spending behavior are largely emotional and experiential. Emotional comfort and practicality were tied as the top reasons for splurge purchases at 15% each, followed closely by hobbies (13%), indicating a blend of self-indulgence and value-driven consumption.

Global comparisons in consumer behavior

The study compiled insights from approximately 1,000 adult consumers across 20 countries spanning North and South America, Europe, and the Asia-Pacific region, including the US, Canada, France, Japan, and China.

Korea’s high ranking stood in contrast to several Western economies. For example, Germany and France followed closely behind Korea with US$53 in average monthly splurging, while the United States came in 15th with an average of just US$35.

This difference underscores how cultural and economic dynamics shape consumer habits, particularly around discretionary purchases such as luxury beverages and fashion.

Economic pressures versus lifestyle habits

Interestingly, the report also highlighted that despite their strong discretionary spending, Korean consumers are experiencing notable financial stress. The Consumer Financial Well-Being Index, a self-assessment of economic health benchmarked to April 2020, fell to 90.6 in Korea as of May this year. This is in contrast to the global average, which rose slightly to 102.8, suggesting that Korean consumers feel less secure about their financial future than their global counterparts.

As reported by The Korea Times, this drop in confidence has not yet translated into a significant pullback in splurge spending. This may reflect a desire to find emotional balance through small indulgences, even amid economic uncertainty.

Outlook for premium brands in Korea

The findings present a compelling opportunity for premium brands, particularly in the food and beverage sector. Despite economic headwinds, Korean consumers continue to prioritize lifestyle spending, with premium alcohol emerging as a standout category.

For international producers and local retailers, this offers a chance to tailor product offerings and marketing strategies to tap into Korean consumers’ desire for comfort, experience, and indulgence.

As Korea navigates the balance between financial caution and consumer desire, its position in the global splurge spending index highlights the enduring appeal of premium products—even in uncertain times.