The holiday shopping season is well underway. And with all the bells and whistles coming at you, it is hard to resist filling your shopping basket with merchandise (or clicking away feverishly online). However, it is a good idea to plan before you spend. According to American Research Group, Inc. , the average shopper around the country claims they will spend about $983 for gifts this holiday season, up from $929 last year. So don’t risk blowing your holiday budget (and spring budget and summer budget) in one fell swoop; instead, read on to learn how to keep your holiday budget under control—so that you can feel the joy of the season and not the pinch of an empty wallet.
Create a Budget
Of course any great plan starts with a budget. Make sure that you factor in all related holiday expenses, and not just gifts for friends and family. That means add in realistic amounts for decorations, holiday travel, work/office gift exchange, teacher gifts, cards and gift wrap, holiday clothes, charitable donations, and food for holiday parties/events. Anything you can think that will cause your December cash flow to be tight probably should fall into this budget. And be sure to re-use decorations and gift wrap you have left from last year—a great way to save and resist the glitz and sparkle in the stores. Here’s an online holiday spending worksheet from www.thebalance.com, and online resource for financial empowerment, to get you started.
Before you even spend a penny figure out not just who you are selecting gifts for but what is expected. For instance, at work you can find out if there will be a “secret Santa” gift exchange and the advised budget. Or maybe suggest a work holiday pot luck lunch in lieu of a gift exchange. Talk to your kids about their holiday wishes—let them create a list and let them know that they will not get every toy they want, but that you appreciate their list as a guide. Maybe let your best buddies know that you treasure them as friends—and suggest celebrating each other with a special night out during the holidays, rather than having to purchase gifts for each other. (I bet they would welcome the chance to socialize this way!) Another great way to limit the urge to overspend on a gift is to make a donation in someone’s name this holiday season.
Make a Shopping List—Track Your Spending!
Now that you know what you are including in your holiday budget, get specific and assign an expected cost to each purchase. For instance, jot down one or two ideas for each person in the assigned price range for their gift. Don’t forget to score coupons to help keep prices in check—online, newspaper/magazine, and in-store coupons can really come in handy. In addition, some great online deals get even sweeter if you can score free shipping. However, the most important part of this process is to track your spending! If you find you are creeping up toward your limit or indeed passing by your cap, it is time to readjust your holiday costs.
Cash or Credit?
Ideally, you should have been saving up for the holidays and only use cash. However, that is not always realistic. So instead, your guiding rule should be to use credit cards cautiously. Don’t get caught up by retailers’ instant (discount) offers if you sign for in-store credit cards—those often have very high interest rates. State ECU’s Visa Credit Cards offer a no annual fee, low rate option—with rates as low as low as 7.99% (CHECK THIS). That is a significantly lower rate than the national average for variable rate cards, which is currently 16.72%, according to Bankrate.com’s most recent national survey.
Handmade and customized gifts are not only appreciated but can also be more thoughtful than any big box gift item. For instance, consider experiential gifts such as taking an elderly relative to a movie or dinner. Or how about treating a friend to a subscription to their favorite magazine or online membership? If you are crafty, why not make some lavender-infused DIY bed warmers for the brisk winter nights? For only a few dollars, you can create one-of-a-kind bed warmers that can be popped in the microwave for a few minutes before bedtime—giving the gift of a tranquil sleep experience. All you need is fabric, stuffing, thread, rice, and dried lavender.
Cheap and Chic Gifts
Just because gifts are inexpensive doesn’t mean they aren’t ingenious and cool. We found a great resource for 50 cool gifts under $10—like a sleek hangar for scarves (brilliant!) or a starry night light projector. And ThinkGeek.com has some edgy, fun gifts—who doesn’t need a Super Mario Bros Heat Changing Mug or a Star Wars Mini Boba Fett USB Charger?
Gig Economy to the Rescue
A little extra cash can help put some jingle into your holidays. So if you have the time, take on some side jobs to help finance your holiday spending. Certainly some retailers are in need of seasonal help, but another option is to check out some online resources to gig work such via Craigslist. Or you can post your own skills for hire on community boards and online neighborhood online sites.
While the holidays can be quite festive, they also can be quite costly—with payments extending well into the New Year. So with a little careful planning, some research, and a bit of creative spirit, you can find ways to trim the budget and get the most out of the most wonderful time of the year. Happy holidays and happy shopping!