PWC predicts American consumers will shell out approximately $1,530 on gifts, travel, and entertainment this festive season, marking a 7% increase from 2022. About 40% of shoppers are poised to spend more than they did the previous year.
As prices surge across the board, holiday expenses can put a heavy strain on your emotional and financial resources. Budgeting for festivities is a tough task, especially if you and your loved ones don’t see eye to eye financially.
If, like me, you can’t wait for the holiday season and want to enjoy it without going broke, consider these seven helpful strategies for setting up boundaries that promote financial success.
DETERMINE YOUR HOLIDAY EXPENSES
Prior to beginning your holiday shopping, draft a concrete budget that outlines your spending capacity. Analyze your financial standing to ensure your budget is feasible and comfortable for you.
Ideally, your festive expenses should be attributed to funds not reserved for bill payments. However, if you wish to stretch your limit slightly, it’s okay, as long as you don’t tamper with your essential budget, such as rent expenses.
MAKE A PLAN AND STICK TO IT
The festive spirit often causes impulse buying and increased spending. To avoid this, set a budget beforehand and make a list of your main gift recipients and the amount to spend on each.
The advantage of organizing your gift list early lies in the opportunity to start shopping earlier, reducing financial stress in the later holiday period.
MAKE THE MOST OF EARLY SALES
Don’t wait only for seasonal sale events like Black Friday, Small Business Saturday, or Cyber Monday. Leading retailers often provide sales and hot deals throughout the year.
Whether you’re looking for synergistic gifts or a new outfit for the holiday season, early sales often provide competitive prices for high-cost items you’ve been aiming for. This measure will also help stretch your dollar during the holiday rush.
COMPARE DEALS BEFORE BUYING
To make economical purchases during the holiday, be on the lookout for sales, discounts, and promotions. Schedule your shopping around sales events, and use apps or websites to compare prices.
Merchants usually offer their best deals during the period between Black Friday and Cyber Monday. To maximize benefits, research prices well and consider online retailers who might provide better deals.
CONSIDER ALTERNATIVE GIFTING METHODS
Contemplate gifting alternatives such as DIY gifts, experiences, or charitable donations instead of pricier options. Offering your time could also be a meaningful and cost-effective gift, particularly for loved ones living far away who would appreciate your visit.
DIY GIFT WRAP AND DECORATIONS
Wrapping gifts can be quite expensive; after all, Americans spend around $3.2 billion per year on this alone, as per Hallmark research. Let your creativity shine by making your own decorations and gift wrap. This fun, festive activity saves money compared to buying upscale decorations and gift wrap.
ADOPT ECO-FRIENDLY MEASURES
Cheap, low-durability products often deteriorate rapidly, generating waste and draining money. Opt for gifts that need minimal packaging, like concert tickets or gift cards. Use recycled-content greeting cards to decrease the amount of raw paper used during the holidays.
Gift eco-friendly items such as a stainless steel water bottle, a reusable shopping bag, or toys made from recycled material. Don’t forget, homemade baked goods always win hearts. Always recycle items including large cardboard boxes, gift boxes, electronics, and Christmas trees, along with regular recyclables.
FINAL THOUGHTS
Setting financial boundaries during the holidays is a strategic and mature way of managing your money. This approach not only allows you to relish the season without compromising your financial health but also nourishes a healthier, more sustainable relationship with money:
• It prevents overspending, a common issue during the holiday season due to increased costs for gifts, decor, travel, and leisure. Without financial boundaries, you might exceed your budget, causing financial stress and potential debt.
• It reduces financial anxiety, a prevalent concern during and after the holidays. Clear boundaries help manage expectations, push down stress levels, and allow you to participate in the festivities without constant fretting over finances.
• It minimizes post-holiday debt, as overspending during the festive period can lead to credit card debt that may take months to clear off. Setting financial boundaries helps avoid piling up debt and related interest charges.
• Without financial boundaries, there’s a risk of impulsively buying items you might later regret, which can impede progress towards your other financial objectives.
