How to Save Money During the Holidays
The holiday season is one of my favorite times of the year! It’s a time full of joy, togetherness, and celebration. However, it can also be a season of financial stress for many and one of the top reasons why it’s so difficult to save money. The pressure to buy tons of gifts, host gatherings, travel to see family and friends, and decorate your home can lead to excessive spending and, in some cases, holiday debt. It’s not the most exciting way to kick off the New Year. But it doesn't have to be this way! With careful planning and a few savvy strategies, you can enjoy the holidays without breaking the bank.
In this blog post, we'll discuss practical ways to save money during the holidays, ensuring that your season remains festive and debt-free! From setting a budget to starting early, we've got you covered with a full guide to holiday fun!
How To Save Money During The Holidays
Here is a list of your saving tips on how to save money during the holiday season!
Start Early
Create a Holiday Budget
Make a Shopping List
Embrace the gift of DIY
Utilize a Savings Account
Set a Dollar Limit per person + on Gift Exchanges
Be Cautious about credit cards
Take Advantage of Discounts and Sales
Make your Gatherings a Potluck
Stay Mindful
Start Early
The first step to saving money during the holiday season is to start early. Waiting until the last minute can lead to lots of pressure and stress, impulsive buying, and overspending. As soon as the holiday season approaches (as early as October 1), begin thinking about your holiday spending plan and purchase things ahead of time. Travel tickets, gifts, decor, etc. Write out a list of gift ideas for each family member or friend, buy those plane tickets early, create a timeline for when you'd like to have your shopping completed and stick to it. Starting early allows you to take advantage of sales, discounts, and special offers that occur before the holiday rush.
PRO TIP: If you are buying plane tickets early, stay on the lookout for deals as the time gets closer. A lot of airlines will allow you to purchase at that deal price and refund the rest.
Create a Holiday Budget
One of the most effective ways to save money during the holidays (and really any time) is to set a budget. Determine how much you can afford to spend on holiday gifts, decorations, and festivities. Consider all your holiday expenses, including gifts, travel, food, and decorations. Once you've calculated your budget, stick to it! At first, I tend to see people feel guilty because they equate their spending to their generosity. Spending more money doesn’t make you a more generous human being. Is it wrong to spend more if you can? Of course not! Being financially generous is one of the best feelings! But it’s not the best feeling when it’s putting you into debt and making it hard to sleep at night. Your budget will be your guiding light to help you make the spending decisions you need to do what’s right for you!
Make a Shopping List
Before you hit the stores or start browsing online, make a comprehensive shopping list. This list should include all the people you need to buy gifts for and the items you plan to purchase if you are hosting a party or gathering. Having a clear shopping list helps you stay focused and avoid impulse purchases.
Embrace the Gift of DIY
If you ask me and most of my clients, the DIY gift that someone made for me is ALWAYS my favorite and the one I remember the most! How special is it that they took the time to hand make that for me? Consider creating DIY gifts for your loved ones. Handmade gifts not only carry a personal touch but also save you money. Maybe you took some time to invest in yourself this year and picked up some hobbies that you’d like to share. Homemade cookies, crochet blankets, or handcrafted photo albums can be meaningful and budget-friendly presents. It’s also a wonderful way to spend time with your family or friends, connect, and take some time to engage in some fun or a favorite activity of yours!
Utilize a Savings Account
Open a dedicated holiday savings account to help you manage your finances during the holiday season. You can start saving early (as early as January!) and set up automatic transfers into this account, which will help you accumulate a substantial sum by the time the holiday shopping begins. Having a separate account prevents you from accidentally dipping into your holiday savings for non-holiday expenses and being prepared for the spending you expect to do every year!
PRO TIP: Open up a Money Market or High Yield Savings Account that earns a little more interest than a standard savings account. If you’re money can earn on its own, let’s make it work for you! Be sure to check at your bank for minimum balances and fees.
Set a Limit on Gift Exchange
If you exchange gifts with family and friends, consider setting a limit on the amount you spend on each gift. This can help everyone stick to their budgets while still enjoying the spirit of gift-giving. Just like with holiday foods and feeling pressure to eat them, odds are that everyone is feeling a little stress behind all the spending. Setting this limit can help remove that pressure and avoid the guilt from someone showing up with a $200 gift while you show up with a $20 gift.
Be Cautious with Credit Cards
If you know me, I’m not one to encourage the use of credit cards. However, Credit Cards are great at promoting their usage and encourage you to do that by earning rewards. Psychologically, our brain is encouraged to spend more to earn more rewards which can easily spiral us into spending more than what we planned and landing us in debt.
If you use credit cards, make sure you have a clear plan to pay off the balance in full right away to avoid the high-interest charges. My personal favorite, consider using cash or debit cards for your holiday shopping to stay within your budget! Trust me, you’ll end up spending less and with the reward of not having debt by the end of it. :)
Take Advantage of Discounts and Sales
If you’re not a coupon clipper, it’s a great time to become one! The holiday season always has awesome opportunities to save money. Keep an eye out for discounts and sales, both in physical stores and online. Many retailers offer early bird sales, Black Friday deals, and Cyber Monday discounts and often extend those deals beyond those particular days. Utilize these opportunities to purchase gifts and holiday items at a fraction of their regular prices.
Host a Potluck Gathering
If you're hosting a holiday gathering, consider making it a potluck. It takes off SO much pressure and saves you time, money, effort, and energy by not making every single dish yourself. There is also something fun about everyone involved contributing to the gathering and trying everyone's recipes!
Stay Mindful of Holiday Debt
It's essential to be mindful of holiday debt. 1 in 3 American’s shared that they overspend during the holidays increasing their debt, particularly on their credit cards. Overspending during the holidays can lead to financial stress in the following months and it’s not the best way to kick off a new and fresh year ahead.
Plan ahead, Stick to your budget, and avoid impulse purchases. Keep your long-term financial health in mind and know that it’s okay to stick to what you can do vs. feeling the pressure to extend yourself beyond what fits you and your budget!
Ready to Save this Holiday Season?
Saving money during the holiday season is entirely possible with some careful planning and smart financial choices. Starting early, creating a budget, and setting limits on this years gift exchange are key strategies to ensure a debt-free and enjoyable holiday season. By utilizing a savings account, making a shopping list, and being cautious with credit cards, you can successfully navigate the holiday spending frenzy. Remember, the true spirit of the holidays is about love and togetherness, not about the price tag on the gifts you exchange. With these savings tips, you can have a joyous holiday season without worrying about your finances!
Need help in getting your financial plans in order and find your starting point? Let’s talk about how we can create plans to keep you on track this holiday season and find joy and happiness with your money!
