PWC predicts American consumers will shell out $1,530 on gifts, travel, and entertainment this festive season, a 7% increase compared to 2022. It’s projected that 40% will spend more than last year. Given the current high cost of living, holidays can be financially and emotionally overwhelming. Budgeting during this time can be a tough balancing act, especially when you’re not on the same wavelength as your loved ones.
If you’re like me and adore the holiday season but want to enjoy it without straining your pocket, here are seven useful tips to maintain financial stability.
DETERMINE HOLIDAY BUDGET
Before diving into holiday shopping, decide on a strict spending limit. Evaluate your financial status to ensure it’s an amount you can handle stress-free.
The budget for gifts shouldn’t interfere with your bill payments. However, if you want to increase your spending allowance, ensure it doesn’t cut into your rent or essential bills.
CREATE A GIFT LIST AND ADHERE TO IT
The holiday spirit can often lead to overspending, hence setting a budget beforehand is vital. Draft a list of people you plan to gift and assign an individual budget for each.
Starting this process early gives you the advantage of time. Shopping little by little in advance gradually spreads out the impact on your budget.
CATCH EARLY BIRD SALES
Don’t solely rely on traditional holiday season sales like Black Friday, Small Business Saturday, and Cyber Monday. Keep an eye out for deals offered by popular retailers throughout the year.
These early sales provide great deals, especially on high-priced items, and help you avoid the last-minute holiday rush.
RESEARCH FOR BEST PRICES
To economize on your holiday purchases, keep a sharp lookout for sales, discounts, and promotional deals. Plan your shopping around these events and compare prices across different platforms before buying.
HIGH IMPACT, LOW-COST GIFTS
Expensive gifts aren’t the only option. Alternative ideas like handmade gifts, experiences, charitable donations, or even your time can be just as, if not more, meaningful while being significantly less costly.
DIY DECORATIONS AND WRAPPING
According to Hallmark’s research, Americans spend an astounding $3.2 billion annually on gift wrap. Counter this by creating your own decorations and wrapping paper, which is both fun and encourages savings.
SUSTAINABLE AND ECO-FRIENDLY
Cheaper, less durable items often don’t last long, causing waste and unnecessary expense. Gift items that require minimal packaging or consider environmentally friendly gifts such as a reusable bag or solar-powered charger. Don’t forget, homemade treats are also great hit and tend to be cost-effective!
TO WRAP UP
Establishing financial boundaries during the holiday season is a proactive way to manage your finances without compromising your festive cheer. It can:
– Prevent overspending on increased seasonal expenses e.g., gifts, decoration, etc. – Reduce financial stress common during and after the holiday season.
– Minimize the risk of post-holiday debt, thereby avoiding additional interest charges.
– Limit impulsive purchases that might obstruct your other financial goals.
Remember, it’s all about striking a balance between enjoying the holiday season and maintaining financial sanity, courtesy of SmartAsset.com.
