As we approach the holiday season, most of us are probably geared up for celebrations, connections, and joy. The average American plans to spend over $1,000 during the end-of-year season on gifts, parties, or decorations. While the holidays are exciting, holiday spending can add up very quickly; if you don’t plan your budget accordingly, your festivities will be marred by financial stress.
The good news is that setting a budget for your holiday expenditures can allow you to enjoy yourself while avoiding financial pitfalls. That doesn’t mean compromising on the cheer and joy of the season but being a little creative with how you spend so you can enjoy the festive season without breaking the bank.
You can start by breaking down your budget into three categories. Allocate 50% of your budget to gifts, 30% to parties, 10% to decorations, and another 10% to miscellaneous expenses. This approach ensures that you remain within your spending limits and that every dollar you spend serves a purpose.
Here are some proven ways of curbing your holiday spending.
Allocate A Spending Limit For Gifts
Exchanging gifts is a significant part of the holidays. However, it’s also where most people end up overspending. Start by making a list of people you plan on getting gifts for and allocate a spending cap for each person. To stay within that limit, you can explore budget-friendly gifting ideas like handmade gifts, which can help you save up to 50% when compared to retail prices.
Plus, it has a sentimental and personal touch far more valuable than flashy price tags.
Another way to stay within the budget is to organize a gift exchange like a Secret Santa. Not only is that fun, but also a handy way to ensure everyone gets gifts while significantly reducing costs.
Put Your Creative Skills To The Test
Christmas decorations can be costly; before you know it, the bills from your favorite party store keep piling up! But you can save money on decorations by reusing the ones from previous years. Or, if you have a knack for creativity, you can try your hand at some DIY decorations. Plenty of online tutorials teach you to make wreaths, ornaments, garlands, and other decorations from inexpensive materials like pinecones, paper, and recycled items.
You can also exchange your decorations with a family member or friend. This way, you’re refreshing your holiday decor without spending a cent. If you’re someone who shops well in advance, you can also consider buying decorations during the post-holiday clearance sales. The deals can be as impressive as 75% off, saving you a serious chunk of money for the following year.
Avail Holidays Discounts And Sales
To reduce your holiday spending, you should time your purchases wisely. Wait until some fantastic holiday deals, such as Cyber Monday, Black Friday, and pre-Christmas sales, come up. Generally, retailers offer tempting promotions leading up to the holiday season, so watch out for sales on any items you hope to purchase. To stay in the loop, you can sign up for loyalty programs or store newsletters that offer early sales access and exclusive discounts.
Shop At Thrift Or Second Hand Stores
Thrift stores are a treasure trove for unique, affordable holiday gifts and decor. From valuable collectibles and carefully-used items to vintage pieces and much more, you can find some unique pieces for a fraction of the retail price. For example, you can purchase a thrifted painting and frame it elegantly to present it as a one-of-a-kind gift.
Follow A Cash-Only System
Withdraw a set amount of cash you have allocated for your holiday expenses and put it into separate envelopes that are labeled for each category. Once the money for a category is gone, you’re done spending on it. With this approach, you’re forced to be more mindful of your budget. Moreover, handling your money physically makes you more conscious about resisting impulse buying.
Prioritize Experiences Over Material Things
Memories create more long-lasting impacts than material gifts. To make the holiday season memorable, plan a family outing, get kids to bake holiday cookies together, or host an intimate BBQ movie night. Quality time spent together can create everlasting bonds, making sure that families and friends prioritize connection over consumption. You can also send gifts in the form of handmade ornaments, baked goods, and cute handwritten cards.
Earn Some Extra Cash
A great way to cut down on your spending is to offset your holiday expenses by earning more money. Most retailers hire seasonal workers, so you can look for gigs in your local mall or shopping center. You can also take up freelance or babysitting gigs and leverage such opportunities to earn extra income. You can also sell used items or gifts from last year on Facebook Marketplace, eBay, and similar sites.
Final Thoughts
When you establish a holiday budget, it doesn’t mean that you’re sacrificing the joy of the season. Conversely, it’s about being more conscious about your spending choices by planning ahead, setting limits, and prioritizing needs over wants. Doing so will ensure that you can celebrate without suffering from any financial regret or setback!
