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Make out your List…
One you’ve determined how much you can afford to spend, you are halfway there. Next, be sure to prepare a list of gifts you intend to buy. Jot down the approximate cost of each one, and then add them together. Also, try to figure out what you intend to spend on such items as wrapping, cards, postage, food, entertainment and travel. Use our worksheet so that you include every category [link]. What is your total? Compare it with your holiday fund. If you’ve gone over budget, review the worksheet again and economize by cutting back. Repeat the process until you know that your spending will be on track. This step is critical because it prevents overspending later on. |
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It’s the Thought that Counts
Remember, when you give someone a gift, it’s the thought that counts. The amount you spend is not a reflection on you as a person. If you find that you cannot afford to purchase many gifts this year, prioritize your list of recipients. You can always let your family and friends know your intentions. That way, if you plan not to exchange gifts this year, you won’t feel uncomfortable if they buy one for you.
Once you’ve drawn up your gift list, it is important to carry it with you. This will help you stay focused, get through the stores much more efficiently and avoid the urge to shop impulsively. Then, follow Santa’s example by checking your list again before you purchase anything. Think about the true meaning of the gift. Is it appropriate and necessary? Is it within your price range? If the answer is no, don’t waste your time and money on it, especially if you planned to use a charge card. Move on to a more suitable item. |
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Monitor your Spending
To be sure you don’t stray from your predetermined limit, withdraw the holiday fund from your bank or credit union account, place it in an envelope and take it with you. Use that amount only. When the cash is gone, then that’s it —no more shopping. Or, use your check card so that the money is debited as you go along. To keep a firm handle on your budget, don’t forget to list all of your purchases in a small notebook. Items such as cards, wrapping, postage and decorations really add up, so be sure to itemize them too. This way, you know exactly what you’ve spent and can avoid unintended surprises. |
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Use Credit Wisely
It is common to go 30% or more over budget by using credit instead of cash. If you feel you cannot get through the shopping whirlwind without plastic, then use only two low-interest rate cards. Once you start taking out a wallet full of cards, it becomes more difficult to track your purchases. Never use expensive department store cards – their APR’s are the highest around (don’t apply for these cards just to get a one-time discount). If possible, try to use a zero-balance card that you can pay off in full. Designate the other card for items you can pay off within three months. To really keep your finances under control, debit each credit card purchase in your checkbook register. This way, you will be prepared to pay the bill off when your statement arrives.
Remember that the holiday is the time for merchants to persuade you to shop endlessly. To prevent excessive spending, ignore credit card offers to skip a payment, as this “gift” is merely an interest-bearing expense that you will have to make up for at a later date. Also, steer clear of “buy now, pay later” inducements as they encourage you to spend money that you do not have. |
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No Last-Minute Shopping – Budget Your Time Carefully
The best way to save money during the holiday season is to shop early and shop carefully. Don’t get caught up in the eleventh-hour Christmas rush. Frantic, last-minute shoppers rarely come out ahead. If you are exhausted or pressed for time, it’s easy to pick up anything, no matter how frivolous or expensive, just to have a gift to give. As a result, you end up buying items with money you don’t have.
Make the time to start shopping as early in the season as possible so that you buy only what you need and stay well within your budget. Don’t rush through your purchases either. By planning your time wisely, you will be able to comparison shop so that you can stretch your funds even further. Read through catalogs, make a mental note of upcoming sales, and browse the Internet to find the best deal possible before you go to the Mall.
The inconvenience of crowds and long lines compels a lot of people to buy any item – regardless of price -- just to get out of the store. To avoid this, make an effort to shop the least crowded time possible. The best time to shop is usually early in the day and early in the week. |
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One final tip: Many people get so caught up with the whirlwind of shopping that they don’t realize when enough is enough. You need to know when to stop. Hours on end at the mall will not leave you with happy holiday memories. When you’ve made all of the purchases on your list, go home and observe the true spirit of the season by spending your time with loved ones and friends.
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