The holiday season is officially upon us! While it’s a beautiful time of year, the holidays can be stressful financially as families prepare for holiday gift-giving and other traditions. Use this guide to create a holiday budget that won’t leave you stretched or stressed in the new year.
Not all families have the means to spend their income on the latest technology or most popular toys. But that does not mean that their holiday will be any less memorable. Smart spending and improving your financial literacy shouldn’t take a break for the holidays. If you’re dedicated to creating a realistic holiday budget, read on for our tips.
The Average American May Spend Nearly $1500 on The Holidays
Create a Clear Holiday Budget Before Spending
Starting to look at your spending ability for the holidays earlier rather than later is the key to success here. Plan early and list all your potential holiday expenses, including gifts, decorations, travel, and even grocery budgets. A bonus to planning early is that you’ll have more time to spread your financial expenses instead of finding yourself spending all at once. If you need help creating your budget, check out our recent article on budgeting 101.
Look Back at Last Year’s Holiday Spending
Each year can be a learning opportunity to hone your holiday spending habits. Dig out your receipts from years past to make some realistic financial goals for your holiday budget this year. If you know you went a little overboard last year, consider ways to reduce your spending, like opting for DIY gifts or reusing decorations from last year, thrifting, or borrowing items to make your holiday special.
Make a List (And Check it Twice)
Create a list of everyone you plan to buy gifts for and allocate a specific amount for each person. This will help you stay focused and prevent impulse spending. Consider alternative gift options, such as homemade gifts or experiences, which can be more meaningful and budget-friendly. Include your expenses beyond the gifts you plan on giving. There are some hidden costs associated with the holidays that often get overlooked.
If you’re traveling for the holidays, consider gas costs, food, and overnight accommodations. If you’re hosting, don’t forget to consider the cost of the food and beverages you’re serving your guests.
Time Your Purchases to Take Advantage of Holiday Sales
Black Friday is probably the most famous sales day this time of year. Now that you have your list take some time to check out the stores that have the best deals. Big box stores like Walmart and Target often have sales specific to certain products; keep an eye out for announcements of these sales while considering your gift list.
Do some research to find the best days and times to shop for the gifts and holiday items you need this year.
Communicate and Collaborate with Family and Friends
If you have a large family, consider creating a plan that will spread and even reduce the need for spending. Instead of giving gifts to every family member, try secret santa-style gift-giving this year. Being spend-conscious doesn’t mean you must opt out of all holiday festivities. Communication and coordination with family or friends is a way to create a plan that works for everyone’s budget.
Regardless of your holiday budget, this time of year is about spending time with those you love! We wish everyone a safe and happy holiday!