How To Financially Prepare For The Holidays
The holidays are a time of year where people come together to enjoy time with their family and loved ones. The problem that a lot of people have is balancing the need to give their loved ones everything that they want and not starting off the new year drowning in debt. Fortunately, there are things that you can do that will help you financially prepare for the holidays, helping you achieve the balance of giving the perfect gifts while being easy on your budget.
Think about Your Budget
One of the first things that you need to do is decide on a budget of what you are willing to spend on gifts. It can be a good idea for you to start by creating a list of anyone that you plan on buying gifts for. This should be a detailed list that will include assigning a specific dollar amount for each of the people on your list. Are you traveling to go back home to family? You will also want to plan for other things like travel expenses, including plane tickets, gas for your car, and a hotel.
By creating this list, you are going to be able to know exactly what you need to spend so that you know how much money you need to save for the holidays. You may be tempting to go over your budget that you have set for the perfect gift, but by going over budget for one person, you may end up having to sacrifice a gift for another. Or, even worse, you will risk going well over your budget by overspending on everyone. Stick to your budget to avoid going into debt because of the holidays.
Save Money Aside from Spending
In general, you should be doing whatever you can to save money across all aspects of your life. Simple changes in your daily life can have a significant impact on your spending, allowing you to save more money in the long run. For instance, say you spend $3 dollars on your daily coffee. If you only have one cup of coffee every day, you are spending nearly $1,100 every year. If you have 2 coffees every day, you are doubling that. By making changes like making your own coffee every day, you can save a fortune.
Figure out ways to save yourself money by cutting extra expenses that you don’t need. You don’t need to have takeout every night. You don’t need to go on spending sprees every time that you come up with extra money. When the holidays are coming, you need to scrimp on whatever you can to ensure that you have more money come the holidays. With your budget in mind, you will know exactly how much you need to save. However, you can save more than that and you may either have more money to spend on your presents or you can just pocket these savings for other things like some type of emergency.
There are some simple things that you can do to save money throughout the year in preparation for the holidays, including:
- Doing a No-Spend month, where you only spend money on the necessities.
- Cut something, like your daily coffee. This will help you save money all year round, not just at the holidays.
- Pause/Cancel recurring subscriptions, especially looking out for ones that you don’t actually use. These are small changes that help offset spending.
Get a Second Seasonal Job
During the busy holiday seasons, many places hire for seasonal work allowing them to get the staff that they need for their busiest times. This also gives you an opportunity to make some extra cash come the holidays. This could be hard to accomplish, depending on your work schedule but you may find something that works within your busy schedule.
If a traditional job like this doesn’t work, you can find numerous other side hustles that you can do to earn money this time of year. Can you make something that you can sell that would make for great decorations for the holidays or great gifts? Do you have a special talent for wrapping presents or shopping for gifts? These are things that people are willing to spend on around the holidays. You may even find something that you can do all year round that will help you keep some extra money in your pocket on a schedule that works for you.
Coupons, Rebates, and Rewards
It’s not just about how much money you save; it’s also about finding ways to maximize the money that you have saved. Maybe you have cashback rewards on your credit card that you can use to spend on gifts. Maybe you have saved up points from shopping sites that you can use to save money on presents. Using websites that give you rebates or points back for buying online can help you to save money and gain points to use for the next holiday season. There are also plenty of apps that you can get on your phone to help with your holiday savings.
There are also coupons that you can use. For instance, if you buy items at Target, you can use their app to load coupons onto one barcode/account that you can use to save money. Take advantage of sales that offer you a free gift card but be sure that you aren’t buying something that you wouldn’t be buying anyways. The same applies to coupons. You won’t save money if you buy things just because you have a coupon. You want to make sure that you are taking advantage of sales, coupons, and other perks only if you are already buying or will need to buy those items.
Find Cheaper Gifts
You may have had an idea in mind of what you want to buy your loved one, but you may not like the price when you get into buying these gifts. In those cases, it can be important for you to know how to adjust your plant to purchase cheaper gifts. Just because you spend less on the gift, that doesn’t mean that the gift is any less meaningful.
You may even find an even better gift for your loved ones at a price that you can better afford. Maybe you can even make them something nice. If not, you need to find some type of sacrifice. Instead of buying a brand new holiday dress, you could always borrow one or buy a dress from a thrift store.
Start the Process Early!
Instead of waiting until the holiday season is approaching, maybe you should start this process a lot earlier. This can not only give you more time to save but it will also help you ultimately save some money. For example, if you wait until the last minute you are going to spend more on your travel expenses. By planning your trip earlier, you can take advantage of great sales.
When you start the process early, you can get more time to gather coupons, watching the prices of your gifts rise and fall, and save more money that will allow you to purchase exactly what you want. You can even create a bank account that was made specifically for your holiday savings, allowing you to keep your holiday savings separate from your regular bank account.
Lastly, one of the best benefits of starting the shopping and savings process earlier is that you get to ensure that you get the best gift possible without worrying about them being out of stock. Have a feeling that the toy your kid wants is going to be the biggest toy of the season? Buy it as soon as you can to ensure that you get the perfect gift before the holiday crave hits.
Sales are Your Best Friend
One of the other advantages of starting the buying process early is that you have the ability to take advantage of various sales throughout the year. A lot of people dedicate their time to going out on Black Friday. This isn’t the only time that you can get great sales, which is great since you can avoid the insanity of the rush on Black Friday.
There are plenty of great sales that take place throughout the year that can allow you to save money on whatever gifts you are buying. Does your kid want a cool pair of shoes? Pick them up during the back to school sales. Hit up clearance racks and even tag sales or thrift stores to see if there are new items that your loved ones are going to love. Taking advantage of sales throughout the years will ensure that you get the best price for the items as well as help you avoid the last minute rush closer to the holidays.
Use Cash Only
The problem with credit cards is that people just whip out their credit cards without considering other things like how much they are spending. It can be very easy to lose track of your spending. This can end up leading to troubles like growing debt. But this is a problem that you can avoid by sticking to whatever physical cash you have on hand. Before you go to the store, pull out the money that you are willing to spend on shopping during that trip. This will force you to stick to the cash that you have on hand, avoiding the temptation of overspending. This is where having a list and budget can be extremely beneficial to you.
Another great option is to do a gift exchange rather than just giving everyone gifts. See if your family members are willing to participate in a gift exchange, so that you will spend money on only one person rather than buying small gifts for everyone. This not only helps you to save money, but it helps you to get the money you need to buy the perfect and meaningful gift for the family member that you are buying for.
You can also try a fun game like doing a “white elephant gift exchange” or “Yankee Swap”. These are both games where you bring a single gift to the event and these gifts are exchanged throughout the game. In both of these scenarios, you are able to cap the amount that people can spend on the gifts so that you can ensure that you will save money during this process.
If you are taking this approach, it can be a good idea to let everyone know far in advance that this is the plan. This will increase the likelihood that everyone will participate, which will make this a more successful venture.
Create a List and Stick to It
Are you doing the Black Friday adventure? Whether you are participating during this annual Christmas shopping event or shopping at some other sale, a good idea would be to create a list of what you are buying and how much you are willing to spend on it before you go. However, you need to remember that it’s not only important to create this list but you also need to be sure that you stick to this list.
A big mistake that people make is that they just start buying things that look like they are a great deal. These may be items that you don’t need or your loved ones won’t want as a gift, actually causing you to waste money rather than save it. For this reason, it is important to remember your list and stick to it, unless you were fortunate enough to save extra money that gives you a better buffer on what you are able to spend during your shopping trip.
Set Aside Money for Charity
The holidays aren’t just about what gifts you can buy your loved ones; it’s also about taking this time to gift back to the community. During the holiday seasons, a lot of the charities are doing a rush to raise money or get items so that they can help the community. This includes food drives and drives to give coats and winter gear to people in need. It can be a good idea to ensure that as part of your savings plan, you set aside money that you can give back to these important charities that do such great work.
What’s great about donating money to these charities is that you may even get a tax break for your donation. If you are able to donate more than $250 to a charity, you will want to ask for some official statement that will verify your donation. This can help prove your donation for tax purposes, especially if you get audited.
Don’t Plan a Massive Meal
Holidays are the time of year where you want to get together with all of your friends and family. Feeding all of these people can get expensive, which is why you should consider hosting a potluck dinner instead. This will help you save a fortune on hosting a holiday event, since everyone who is attending will be expected to bring something to eat for everyone. Again, this is something that is best to plan ahead for so that you can make sure everyone is on board with this plan.
This does take some careful planning so that you don’t end up with 10 pies or potato salads. You can create a simple spreadsheet where you can keep track of the food items that you need for the event as well as what people have already signed up to bring. You could also make it easier for yourself and assign “tasks” for everyone. For instance, if you know someone that makes a killer dessert, have them bring a dessert. There are also websites that you can create food lists on and send invites to people, where they can sign up on the website to see what they are bringing. This will help you keep track of what food to expect and what you need to make to compensate for missing items on the list.
After Season Clearance
Did you use all of your wrapping paper over the holidays? Did some of your decorations fail to make it through the holiday? Stores start trying to get rid of their holiday inventory after the holidays are over, which is something that you can take advantage of. This will give you a great chance to save money in preparation of the upcoming holiday season. You can walk away with some great steals on items that you will need for the next holiday season, saving you money when it comes time to shopping for items.
People tend to get overwhelmed at the holidays, spending money and unknowingly racking up credit card bills. By using these tips to save yourself money, you are going to be able to give your loved ones a great holiday without going further into debt. You may be surprised just how much some of these little changes can make to your pocket.