Lori A. Hendrickson, Extension Educator — Family Resiliency
December 2015. Revised December 2016 by author.
Holidays are definitely the time for giving and spending. And, for many, holidays are also a season for taking on too much debt. It doesn't need to be that way if a game plan is developed ahead of time.
A good holiday spending financial plan is started by setting a spending target. Staying close to the "bulls-eye" limit — or below it — will go a long way towards relieving the stress of being broke after the holidays. Here are some ideas to use:
- Make a budget of how much you want to spend and who you want to spend on. This may mean having family conversations about cutting down on the number of gifts or limiting their value or cost to stay within your means.
- Use cash as much as possible. Limit the use of credit cards since they make it very easy to spend more than planned. Some stores have brought back layaway plans. Layaway helps you get the gift when you see the sale and then spread out the payments over a certain time period. You must pay in full before you can pick up the item.
- Watch for deals and coupons in sales ads and online for gifts and other holiday items, like decorations and food items. Many free shopping apps can assist in getting the latest deals. Check your phone’s app store for apps such as Flipp and RetailMeNot to help you find deals at the stores you shop regularly.
- Challenge stores to price match when you can.
- Purchase items early when you see them on sale if your spending plan allows. Alternately, some gift purchases may wait until after the holiday and you may be able to take advantage of year-end sales. This may be particularly helpful for saving money on big ticket items.
- Homemade gifts or coupons for personal favors such as childcare or a home cooked meal are a great way to personalize a gift without breaking your budget.
- Give a gift to an entire family or group instead of each individual. This option may save money as well as time searching out gifts for each person.
- Gift cards can also be a welcome gift, but try to give cards for retailers that the receiver frequents. For more information on gift cards, listen to this audio clip: Gift Cards Are Big Business (2:02).
There are many ideas for smarter spending, or not spending, at holiday time. Find the ways that make sense for you, save money, and avoid being among those still paying holiday expenses months after the event.
American Financial Services Association Education Foundation. (no date). Holiday Spending Plan.
Mendoza, M. F. (2015, November–December). Smart shopping for the holidays. In University of Minnesota Extension (Ed.), Latino Financial Literacy Program Team Newsletter, 9(6) (pp. 3). St. Paul, MN: University of Minnesota Extension.
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