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The holidays are a time of giving, travel, and social gatherings, and in the hustle and bustle of the season, it’s easy to overspend. A little bit of planning and smart spending can go a long way in helping you enjoy the spirit of the season without putting yourself in a tricky financial situation.
Whether you’re reaching outside of your budget for the perfect gift for your mom or finding that plane tickets cost a bit more than you expected, here are a few holiday spending tips to carry you through your gift-buying, decorating, and however else you like to spend your holiday season!
As tempting as it is to let the magic of the holiday season sweep away your financial worries, setting realistic expectations for your spending can be a huge help.
Start by evaluating your financial situation and deciding on an overall budget for the season. Then divide your budget into categories like gifts, food, travel, entertainment, etc. based on what you usually find yourself spending money on throughout the holidays.
Once you’ve established your categories, take your total spending limit and dedicate certain amounts to each type of purchase. Maybe you put $200 toward gifts and $50 toward decorations. Consider using budgeting apps or templates to track your expenses as the season moves along.
When it comes to prioritizing, take the time to really identify what matters the most to you. Gifts? Experiences? Giving back to your loved ones? Determine what brings the most joy to you and your family during the holiday season and focus your budget there.
One of the most common areas of spending during the holidays is, of course, gifts. There are several ways you can give back to your loved ones without overspending.
Sometimes, time is the best gift of all. Consider sharing ideas for low-cost experiences like a movie night, a homemade meal, or a hiking trip at a favorite park. Experiences often create more lasting, meaningful memories than physical gifts. What better way to show someone you love them than to dedicate your time to being with them?
If you have a lot of people to buy gifts for, maybe in the workplace or in your extended family, consider setting up a “Secret Santa” gift exchange. Everyone in the group draws one name and gets a gift for their designated person; this means rather than purchasing gifts for the whole office or the entire family, you narrow it down to one. You can even set budget limits for a gift exchange to keep the costs down and manage expectations.
Consider do-it-yourself or homemade gifts with a personal touch. Try giving away baked goods, crafts, or a customized photo album or scrapbook.
The best part of shopping? Sales! Try planning your gift shopping around major retail events like Black Friday, Cyber Monday, or post-Thanksgiving sales. There are also a range of cashback programs, coupon apps, or even browser extensions that will search the web for coupon codes for you at checkout.
One of the easiest ways to overspend is impulse-buying. You can avoid this by creating a gift list early—know how many gifts you’re buying, who they’re for, and what they are so that you can dodge the last-minute shopping and unplanned purchases. Prioritize gifts that are meaningful: quality over quantity. Set expectations prior to the gift-buying season with family and friends so that you’re all on the same page.
Another popular expense around the holidays is travel, whether that looks like a plane ticket, gas money, or a hotel booking. Don’t worry—there are ways to save even when you’re spending your holidays away from home.
Book flights, hotels, cabs, and other accommodations early. Making sure everything is locked in well before the holiday season means you’ll get lower prices than you would booking the week of Christmas.
Consider traveling on dates that aren’t as popular for travel. A plane ticket on Christmas Eve or New Year’s Day, for example, could save you a lot of money and still get you where you need to go.
Instead of booking a hotel or an Airbnb, consider cheaper accommodations. Do you have family or friends in the area who would let you crash on their couch for a night? What about home-sharing services or budget-friendly motels?
Many credit cards offer rewards points that can be applied toward plane ticket discounts. Airlines also often have frequent flier or loyalty programs that can be used to cover part or all of your travel expenses.
Retailers and travel companies are very familiar with the urgency of holiday shopping and planning. Last-minute purchases, pay-later deals, and high event prices are all common finds throughout the season. Here are a few holiday spending tips that could help you avoid one of these pricey pitfalls.
Waiting until the last minute to run out and finish your gift list can lead to both higher prices and rushed decisions. Like we mentioned earlier, create a gift lift before the holiday season and stick to it to avoid those impulse purchases.
It may be tempting to go all-in on a deal that lets you obtain something now and pay in the future, but that’s also a risky path that might lead you to build up unmanageable debt. Keep your finances safe and easy by paying up front, and if you do utilize a BNPL offer, use it only for a large, planned purchase that you know you’re able to pay off. As an alternative to a BNPL offer, consider a loan from Credit Central.
If you’ve got holiday traditions that really stretch your wallet, consider modifying or substituting those traditions with low-cost alternatives. Maybe you attend a holiday concert every year, and the ticket prices keep increasing. Watch a live stream of the performance at home instead! Maybe you fly out to meet your family across the country every Thanksgiving—could you meet somewhere in the middle? Communicate with your loved ones and see what lower-cost options are available to you.
Above all, the holidays are about being with the ones you love. Your time and presence is the most valuable resource you have—rather than get sucked into the financial stress and overexertion of the season, use these holiday spending tips to minimize the money talk and maximize quality time with family and friends.
At Credit Central, we know finances can be tricky, especially at this time of year. That’s why we provide tax prep and loan services that put you first. Need assistance? Contact us today to discuss loan and tax support options.
