Holiday Savings

November 15, 2024 - Ria Schultz

The holiday season is often filled with joy, celebrations, and, of course, gift-giving. However, it can also bring a significant financial burden if you're not careful. Between gifts, decorations, and festive gatherings, the costs can quickly add up. That's why it's essential to create a budget and plan your spending during the holidays to avoid financial stress in the new year. Here are some strategies for saving money, making smart shopping decisions, and ensuring a financially smooth holiday season.

Why Budgeting for the Holidays is Important

The holidays come around every year, yet many people find themselves financially unprepared. Without a budget, it's easy to overspend and face financial hardship in January. By budgeting, you set spending limits, avoid unnecessary debt, and maintain control over your finances. Plus, thoughtful planning ensures that your holiday experience remains joyful, not overshadowed by stress.

Budgeting for the holidays involves calculating how much you can afford to spend across all areas, including gifts, food, and entertainment. Once you’ve set your budget, stick to it. It’s not about limiting your holiday joy but making sure you can enjoy the season without the lingering anxiety of financial strain.

Money-Saving Tips for Holiday Shopping

The holiday shopping season can feel overwhelming, with endless promotions and deals tempting you to overspend. But with careful planning, you can find ways to save and still get meaningful gifts for your loved ones. Here are some helpful tips:

  1. Make a List and Set Limits Before you begin shopping, write down the people you want to buy gifts for and assign a spending limit for each person. This helps you stay organized and prevents impulse purchases. Sticking to your list will also stop you from getting distracted by last-minute deals that don’t align with your budget.

  2. Prioritize Quality Over Quantity You don’t have to buy numerous gifts to show your appreciation. Instead, focus on meaningful, high-quality items. Thoughtful gifts that reflect the recipient’s interests or needs will likely be more cherished than multiple items purchased just for the sake of quantity. A smaller, well-considered gift can have a much bigger impact than an expensive, unnecessary item.

  3. Shop Sales Strategically Black Friday, Cyber Monday, and holiday sales can be a great opportunity to find deals, but they can also lead to overspending. Plan ahead by comparing prices online before sale events, and stick to your list to avoid falling for promotions on things you don’t need. Use these sales as tools, not traps—companies are eager to get you to buy more than you intended, so stay focused on your goals.

  4. Collaborate on Big Purchases Have your eye on a pricier item for a family member or friend? Consider going in on a gift with someone else. Splitting the cost with another person allows you to give a more significant gift without breaking your budget. This strategy works especially well for electronics or high-end items.

  5. DIY and Personal Gifts Handmade gifts can be incredibly meaningful without costing much. Whether it's crafting personalized items, baking treats, or offering a service like babysitting or home-cooked meals, DIY gifts show thoughtfulness and effort. People often appreciate gifts that come from the heart more than expensive, store-bought ones.

  6. Wrap Gifts Cost-Effectively Gift wrapping doesn’t have to be expensive. Get creative with cost-effective options like newspaper, brown paper, or reusable gift bags. You can also take advantage of stores that offer free gift wrapping or use simple, yet elegant materials to wrap gifts yourself.

  7. Shop Local or Thrift Supporting local businesses during the holidays can be both cost-effective and meaningful. Many local shops offer unique items that you won’t find in big-box stores. Similarly, thrift stores can be a goldmine for finding affordable holiday attire, especially for those "ugly sweater" parties that often pop up during the season.

  8. Secret Santa or Family Gift Exchanges Instead of buying individual gifts for everyone in your family, consider organizing a Secret Santa exchange or a family gift pool. This way, everyone receives one thoughtful gift, and no one has to overspend buying for multiple people. It’s a great way to simplify holiday shopping and cut costs.

Other Money-Saving Strategies

  1. Limit Dining Out The holidays are filled with events, parties, and gatherings, which often include expensive meals. Eating out regularly can add up quickly, so try cooking at home as much as possible. When you do dine out, look for more affordable options, and save the fancy dining for special occasions.

  2. Increase Income Temporarily If you're able, consider working extra hours or picking up a side job during the holiday season. Retail and service industries often need additional help, and the extra income can cushion your holiday spending and prevent post-holiday debt. Plus, keeping yourself busy with work can reduce the temptation to spend time shopping.

  3. Use Debit, Not Credit It's easy to get carried away with credit card purchases during the holidays, but this can lead to debt that lingers well into the new year. Whenever possible, use a debit card to stay within your means. If you do use credit cards, aim to pay off the balance in full when the bill comes due.

  4. Gift Smartly If there are items you need for yourself, consider asking family members to gift them to you. This way, you’ll receive useful items that save you from purchasing them yourself later.

Conclusion

The holiday season is about spending time with loved ones and creating meaningful memories—not just spending money. By budgeting, sticking to your gift list, and adopting some cost-saving strategies, you can enjoy the season without financial stress. Planning ahead will not only protect your wallet but also make the holidays more enjoyable in the long run.

For more tips and resources on managing your finances during the holidays, or to schedule a financial planning consultation, visit the UNM Center for Financial Capability website or contact us at cfc@unm.edu. Happy holidays!