PWC predicts that this festive season, American customers are set to splash out an average of $1,530 on gifts, travel, and merrymaking, marking a 7 percent surge from 2022. An estimated 40 percent are set to exceed their previous year’s spending. This indicates the heightened potential for financial and emotional stress during the holiday period due to increasing expenses.
Are you a holiday enthusiast seeking to fully enjoy the season without ruining your budget? Here are seven approaches to establish an effective spending plan and navigate financial pitfalls during the holiday season.
1. ESTABLISH FESTIVE SPENDING BOUNDARIES
Before embarking on your holiday shopping spree, it’s crucial to sit and set a specific spending limit that you can maintain comfortably. This should be money separate from your bill funds but doesn’t necessarily need to come from your leftover monthly budget. As long as it doesn’t eat into your necessary expenses, you’re on the right track.
2. PLAN YOUR PURCHASES
Holiday gift-giving often leads to overspending due to the festive spirit. To avoid this, draw up a plan highlighting the main recipients of your presents and the intended expenditure on each. Starting your shopping early lets you take advantage of lower prices throughout the year, easing the financial blow later on.
3. TAKE ADVANTAGE OF PRE-HOLIDAY SALES
Don’t hold out for the typical holiday sales events. Look out for deals and discounts from popular stores throughout the year. This not only helps you acquire bargains on high-value items, but it also helps circumvent the holiday buying frenzy.
4. COMPARE PRICES
Your holiday shopping could be much cheaper if you hunt for the best deals available. Make your purchases around sales events and consider using comparison apps and websites. While there’ll be numerous mouthwatering deals during the holiday sale season, ensure to weigh your options, including online retailers who might have more competitive prices.
5. EXPLORE NON-TRADITIONAL GIFT OPTIONS
Forgo spending a hefty amount on presents and consider other alternatives. These may include homemade gifts, experiences, charitable donations, or simply giving your time. Visiting distant relatives can be a heartwarming gesture that won’t cost an arm and a leg.
6. EMBRACE DIY DECORATIONS AND WRAPPING
Gone are the days when buying gift wrap would drain your funds. Americans dump approximately $3.2 billion into the gift wrap industry annually, as per Hallmark’s research. Save your hard-earned cash by crafting your own reel of decoration and wrapping paper. It’s a fun festive activity that also saves you from buying pricey trimmings and gift wrap.
7. OPT FOR ECO-FRIENDLY OPTIONS
Gifting cheap, poorly-made items that wear down quickly is not only wasteful but costly. Consider presents that have minimal packaging like concert passes or gift vouchers, or eco-friendly gifts such as a solar phone charger or recyclable toys. Do not forget that homemade pastries are always a welcome present. Also, aim to recycle items like gift boxes, large cardboard supplies, electronic devices, and even Christmas trees.
IN A NUTSHELL
Setting clear financial boundaries during the holiday season allows you to indulge in the festivities without jeopardizing your financial health. It helps curb the risk of overspending – a common issue during this period – and consequently reduces financial stress and potential debt. Without such boundaries, you may find yourself making impulse purchases that you later regret, obstructing the achievement of your financial goals.
