Budgeting Tips for the Holiday Season

Monday, November 23, 2020

The holiday season brings lots of joy, but can sometimes cause feelings of stress and concern when it comes to the amount of money spent on gifts and festivities. Overspending can dampen the fun and excitement of the holiday season. Get your spending in check with these holiday budgeting tips from our ASB Dream Team.

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SET EXPECTATIONS WITH FRIENDS AND FAMILY
Your friends and family may have different expectations when it comes to gift giving. If you know you won’t be able to spend as much this year or are planning to keep gifts to a minimum, let your friends and family know in advance. Setting expectations about gifts early can help you stick to your budget.

Talk with family and friends to determine how much you plan to spend on gifts for each other. You can also decide to do something different from the traditional gift exchange this year. For example, you can host a Secret Santa gift exchange where everyone pulls a name from a hat. That way, you only need to purchase one gift for one person. You could also skip gifts altogether and exchange holiday greeting cards instead. No matter what you decide, the most important aspect is to be upfront about your plans so everyone knows what to expect.

LIST EXPECTED EXPENSES
Write a list of all of the expenses you expect to have this holiday season. While gifts are often the most expensive part of the holidays, remember to include other expenses as well. Other costs much include:

  • Groceries for holiday dinners

  • Wrapping materials such as wrapping paper, tissue paper, ribbons and gift bags

  • Holiday cards

  • Shipping and mailing costs

  • Small gifts for non-family gift exchanges (such as a work gift exchange)

  • Charitable giving such as toy drives, cash donations, or food drives

Make sure to add the estimated cost for each category. That way, you have a better idea of where most of your holiday budget is going to end up. If you think you’re spending too much in one area, look for ways to reduce your costs in that area.

For instance, you want to spend less on wrapping paper or gift bags. You can purchase brown paper packaging or use recycled magazine or newspaper instead of holiday-themed paper. Use markers, pens, or colored pencils to add personal touches to the packages.

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MAKE A GIFT LIST
Set up a spreadsheet or use a notebook to list out everyone who is going to get a gift from you. Include a spending limit for each person and a list of potential gifts that are in the right price range. Keep your list on hand when you start shopping for gifts. Refer back to it if you find yourself tempted to buy something outside of an individual budget. This helps remind you that you’ve already set aside a dollar amount for each person’s gift.

You’ll want to include everyone who should be recognized during the holidays — from immediate family to your mail person. Even if you’re just sending a card or giving someone baked goods, listing everyone reduces the chances of missing someone.

SET A SPENDING LIMIT
Give yourself a strict spending limit for your holiday purchases. If you have a holiday savings fund set aside for gifts, for example, or a specific amount set aside for the holidays from your savings, make sure that you determine a cap on how much you can spend this year so that you don’t go into debt from your spending.Challenge yourself to save even more by staying under budget in as many categories as possible.

Worried you’ll go over your limit? Try categorizing your list of expected expenses and gifts. Working with several smaller budgets rather than one lump sum can help you stay within your overall budget. Challenge yourself to save even more by staying under budget in as many categories as possible.

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LOOK FOR BARGAINS
Purchasing items on sale or comparing prices from one retailer to the next can help you to stay on budget. Many retailers will price-match an item for you if you can show that another retailer is advertising it at a lower price. And, remember that stores are ready to make up for time and profits lost during the pandemic, so your wallet may benefit from the retailer wanting to sell their items at a discount.

GET CREATIVE
You don’t have to spend a lot of money to make someone feel special during the holidays. As the old saying goes, “It’s the thought that counts.” Your friends and family are sure to love any gift they receive from you. E-cards are another way to save money and time. Rather than buying holiday cards and paying postage, you can find free or fairly inexpensive e-cards to email to loved ones online. If you want to give someone a gift but can’t afford it, consider giving the gift of your time. You could baby-sit or walk a dog for a friend with an overloaded schedule. An elderly relative might appreciate someone to run errands, do some housework or take them to an appointment. A handmade gift or making a small charitable contribution in someone’s name can also show your gratitude.

With a few easy changes, you’ll be able to cut your spending this holiday season. Use these tips to stick to your budget so you can focus on enjoying the holidays rather than worrying about your finances.