Between family and work events, traveling, gift exchanges and shopping, the holidays can be detrimental to your budget. However, they don’t have to be.
You can’t stop the holidays from coming, but you can certainly plan for them financially. Not only will your wallet thank you, but your sanity will also. Check out the holiday budgeting tips below and get a start on your planning.
Save throughout the year.
Setting a little aside each month for your holiday shopping can go a long way. Consider working a reasonable amount of money to save each month into your budget. Doing this will allow you to spread out the cost instead of being hit with it all at once. Also, check with your local bank on holiday savings programs. They will often have an automated program available that can set aside a predetermined amount each month and reserve it for you until the end of the year.
Create the Ultimate Shopping List
Pre-planning your purchases for the holiday season instead of shopping on the fly is the best thing for your budget. Make a detailed shopping list of literally everything you expect to purchase. Be sure to include:
- Presents for those you are shopping for this year
- Gift purchases for work and holiday parties
- Wrapping paper, tape, tags, bows, boxes, and bags
- Holiday decorations
- Any school related holiday purchases for your children
Once you’ve made your list, assign a set amount you’d like to spend on each item and gift, and get your estimated total.
Budget for Your Shopping List
With your shopping list completed, the next step is to see where it fits in relation to your budget. You may find you’re way outside of the range of what you can afford, but now you can make tweaks to your list to better fit your finances. Taking this step now can prevent overspending, using credit cards, and generally any unwanted surprises during your shopping trips. Once you’ve established a budget, you’re comfortable with, be sure to stay within those confines and limit any spending outside of them. Holiday shopping can be fun, but spontaneous purchases can spell disaster for your finances.
Reduce Your Spending
Reducing and revising your spending habits in preparation for any purchase or event is the smart thing to do. How much you ultimately need to change your spending habits before the holidays is determined by how much you plan on spending. If you have a big family or are generally a big spender during this time, you may need to make some not-so-fun cutbacks to fund your shopping.
Take Full Advantage of Holiday Sales
Some of the best times to save are leading up to and during the holidays. If you’ve made your shopping list, begin regularly searching for sales and deals on items you plan on purchasing. Shoppers will often wait for Black Friday sales to start before they do any shopping, hoping to snag deeply discounted items. Gifts that were not purchased on Black Friday can then be bought throughout the remainder of the season as deals pop up. If you’re not one for the Black Friday crowds and prefer to shop from home, you can still find great sales on Cyber Monday.
Bring in Extra Cash
Maintaining a temporary or side job in preparation for the holidays might be a good option for you to stay within or below your budget. The holidays often present abundant opportunities for seasonal work of which you can take advantage. Remember that the extra work doesn’t have to be forever, but it could be beneficial in helping you meet your holiday goals and avoid starting the New Year off with new debt.