"‘Twas two months before Christmas and all through the shops,
Every store was preparing, putting out all the stops,
Yet one shopper was smart and avoided all tricks,
With great strategies even envied by Old Saint Nick."
The holiday season will soon be upon us, along with the spirit and tradition of festive parties, family get-togethers, and giving gifts. Exchanging gifts is a kind thing to do, but it can also put a strain on your budget. Gift giving is a significant cause of overspending during the holiday season. While it is a good idea to make sure that you get gifts for the people closest to you and not worry so much about acquaintances, it is probably especially true with a tighter budget. Because buying gifts can be expensive, it is important to budget enough savings to cover the expense throughout the year. You might want to consider getting gifts just for the family plus two to three close friends.
Budgeting for the Holidays
While it is never a good idea to keep up with the Joneses, you especially do not want to do so during this holiday season. Following these simple budgeting suggestions for savvy saving will relieve you of your gift-giving stress and allow you to celebrate the special meaning behind your holiday.
Before you begin holiday spending, ask yourself a few simple questions.
- Can I afford to buy it?
- Does the person you are giving the gift to want it?
- Is there a better and cheaper alternative?
Set a Budget
An oversight that many holiday shoppers make is not setting up a budget for holiday purchases. Not setting up a budget can result in over-spending and perhaps lead to maxing out credit cards on holiday purchases. Instead of spending money blindly, make a list of holiday expenditures for decorations, parties, and gifts. Plan your budget; assign a specific amount of money to spend on gifts, decorations, and food and stick to that budget. When you are living on a student budget, you will find that certain times are more challenging to manage than others. Following these simple suggestions for savvy saving from Metro’s Save and Succeed will relieve you of your gift-giving stress.
Another great tip to keep your budget in check this holiday season is to make homemade gifts. Bake cookies or cakes, or use a creative skill that you have to make something that your loved one will truly cherish. Small, thoughtful gifts can leave an impression on the receiver than giving them something purchased at the store. Being creative with your presents cannot only help you save money but can also show affection and care for the person you intend to make the gift for.
If you are unsure about getting gifts for co-workers and trying to stick within a budget, consider participating in an organized present activity like a Secret Santa or White Elephant exchange.
You could also consider getting a group of friends together to volunteer, like caroling outside a nursing home instead of exchanging gifts and splurging on a holiday party. Although it is wonderful to purchase gifts for friends and family, remember to avoid overspending and that sometimes a non-monetary gift can mean even more.
Use Cash Instead of Credit Cards
Another way to avoid unnecessary spending is using cash instead of credit cards. By using cash, you know exactly how much you are spending, and you do not have any hidden fees to worry about. By paying cash, you can save yourself from accumulating debt during the holiday season. If you pay off your credit card debt on time, then using a credit card is acceptable. However, any delay in paying your credit card bills during the holiday season could end up affecting your budget for the coming year.
Plan for the Next Holiday
Planning for the next holiday season is one of the best ways to avoid overspending. Saving extra cash each month will help you have the funds in place for your holiday budget. Additionally, take advantage of post-holiday sales that many stores offer. Buying seasonal items and gifts in January can provide substantial savings for the following year. Read more on Metro's Save and Succeed about how to plan for the holiday season if finances are tight.
Members using Metro’s online banking or mobile banking app may apply for a $500 Holiday Loan or Skip A Loan Payment during November and December. Learn more and apply today https://www.metrofcu.org/loans/holiday-skip-a-payment2021.