PWC forecasts American shoppers will shell out $1,530 on presents, trips, and entertainment this festive season, a 7% rise from 2022. Approximately 40% of these consumers will spend more than they did the previous year.
Considering the escalating prices of almost everything, holidays could be demanding both emotionally and monetarily. Budgeting for festivities can be a challenge, particularly if friends and family have a different financial mindset or spending habits during this period.
For those who cherish the holiday season like me and wish to enjoy it fully without straining their finances, below are seven measures to implement for a financially triumphant holiday.
DEFINE HOLIDAY EXPENDITURE BOUNDARIES
Before embarking on your holiday shopping spree, sit down and establish a firm budget. Review your finances to ensure you’re comfortable with your spending limit.
A reasonable holiday budget only includes the money that’s not meant for bills. However, if you desire to have a little extra, your budget isn’t restricted to what remains at month’s end. The key is to spend within your means, making sure it doesn’t conflict with crucial expenses like rent.
CREATE AND FOLLOW A SHOPPING LIST
Gift-giving can lead one to overspend when swept up in the holiday cheer. That’s why pre-setting your budget is crucial. Stay within this budget by making a list of the people you’re gifting, and allocate a specific amount for each individual.
Starting your shopping early, based on your budget, mitigates the financial impact later on. It’s best to avoid the scenario of creating your list late in the year and realizing that your budget falls short.
TAKE ADVANTAGE OF EARLY SALES
Don’t wait until Black Friday, Small Business Saturday, or Cyber Monday. Many retailers offer deals throughout the year.
Whether you’re eyeing budget-friendly gifts or adding to your festive collection, these early sales often provide good deals on larger purchases. Shopping during these sales also helps you stay ahead of the late seasonal rush.
EXPLORE FOR THE BEST BARGAIN
Plan your shopping spree around sales, discounts, and promotions to optimize the value of your purchases. Anticipate the year’s best deals during the traditional discount period between Black Friday and Cyber Monday. Do your due diligence in price comparison and bear in mind online retailers that may present better deals.
CONTEMPLATE NON-TRADITIONAL GIFT OPTIONS
Rather than pricy presents, consider alternatives like homemade gifts, experiences, or charitable donations. Gifting your time by visiting distant family or friends can be a valuable way to appreciate them without straining your budget.
DIY DECOR AND GIFT WRAPS
Americans annually spend around $3.2 billion on wrapping alone, as per a Hallmark survey. Get artsy and create your own festive decorations and wrapping materials. This can not only be a fun holiday activity but also a significant saver compared to buying premium wraps and decor.
ECONOMIZE, RECYCLE, AND REUSE
Avoid cheaper items that deteriorate quickly, leading to waste and additional expense. Opt for gifts needing minimal packaging, like concert tickets or vouchers. Choose recyclable items for gifting like a stainless steel water bottle or a solar phone charger. Always remember, homemade goodies are invariably popular. Use every chance to recycle big boxes, electronics, Christmas trees, and ordinary recyclables.
FINAL THOUGHTS
Implementing a financial buffer throughout the holiday period is a constructive and responsible approach to managing your money. It promotes a healthier and sustainable financial relationship and mitigates the propensity to overspend, subsequently averting unwarranted debt.
Moreover, clear financial parameters alleviate financial stress, prevalent during and after the holiday period, helping you relish the festivities without worrying about your finances.
These financial boundaries essentially reduce the aftermath of holiday overspending resulting in potential debt trickling into the New Year alongside the growth of interest charges. Further, they help to avoid impulsive and regrettable purchases that could hamper your progress towards other monetary goals.
