RECESSION? What recession, according to a generation of young people who have grown up with full employment, low interest rates and a buoyant economy.

While more than two out of three Australians say they intend to cut back spending this Christmas, generation Y is planning a shopping spree according to a snapshot of more than 1000 Australians. And they will be spending $220 on average playing Santa Claus to themselves, more than double ($107) what the general population has budgeted for their own wish list this Christmas.

Baby boomers and generation x-ers should not be too quick to condemn, however. The survey, conducted earlier this month by Galaxy Research for the retail bank ING Direct, also found that those aged between 18 and their early 30s were planning to be even more generous this Christmas to their partners, children and friends, possibly earning them the tag the "generous generation".

Partners and children of generation Y shoppers will have between 30 and 35 per cent more spent on them than what the general population say they will spend - $245 per partner and $264 per child, compared to $189 and $196 respectively.

Overall, 37 per cent of generation Y respondents said they planned to spend more this year than last, twice the national average of 17 per cent. But they also planned to do it sensibly, with two-thirds of young people, compared to 42 per cent of the general population, saying they would not be using a credit card or store card to fund their Christmas splurge

ING Direct's executive director, Lisa Claes, said the findings were a positive sign that many inexperienced consumers were spending, or intended to spend, within their means, while their overall optimism in the face of a recession was in part due to the widening gap in the disposable incomes of the mortgage-free generation compared to previous generations.

Generation Y's optimistic Christmas plans may give heart to the the Treasurer, Wayne Swan, who last month announced a $10.4 billion stimulus package to encourage festive spending.

A subsequent survey by the Australian National Retailers Association found that less than 10 per cent were planning to spend the windfall on Christmas gifts or entertaining.

These findings were backed up by the Galaxy poll which found about three-quarters of all consumers intended to cut back on luxuries such as travel, eating out and gifts.

One in four people surveyed said they would also be spending less on food and alcohol.