When many people think of holiday spending, gift-giving is the first thing that usually comes to mind. And rightfully so, as making your list (and checking it twice) to ensure that your friends and loved ones have a memorable holiday is a big part of the Christmas season. But there’s a lot more that you should be budgeting for around the holidays, as things like travel expenses, decorations, food and more can all add up.
As we reported in a previous edition, this year’s holiday spending is expected to exceed $1 trillion, a new record. And while this is good news for the economy, this doesn’t mean that you should be reckless with your spending. On that note, we’ve put together this handy list of spending tips to help. Have a look:
Gift Buying Tips
Let’s start with what’s likely to be your biggest expenditure this holiday season: gifts. For starters, you should make a list of everyone who you need to buy for and then set a specific spending budget for each person. After you’ve done this, here’s a look at some ways to save money while not skimping on the quality of the gift:
- Cash in your credit card rewards: If you don’t use a credit card that rewards you for purchases, start now. Even a 1 percent match on every dollar you spend will add up over time and give you a nice little cash stash for when you need it. The holidays are a great time to cash in on your rewards.
- Start early, and shop smart: Don’t think of Christmas shopping as something that is only done once the calendar hits November. Keep your eye out for items that would make great gifts at all times of the year, and purchase accordingly. Not only does this help you spread your spending out, but it also makes the holiday shopping season less chaotic. Additionally, be sure to shop smart. If you’re not an Amazon Prime member and enjoy shopping online for gifts, make sure you hit that minimum amount to receive free shipping. Also, be sure to check out Black Friday and Cyber Monday deals.
- Get into good purchasing habits: With shopping activity peaking around the holidays, so too does criminal activity. And we’re not talking about shoplifters so much as we’re talking about cyber thieves. While paying in cash, or using a pre-paid debit or a token-based payment method (i.e., Apple Pay) are the safest means of payment, be sure to only use your credit card if the retailer offers a chip reader. Also, be sure to check your balance to monitor for unusual activity and only shop online on secure, trusted sites.
Other Holiday Spending Tips
The big thing you need to remember is that gift buying isn’t the only expense you’re likely on the hook for this holiday season – and you don’t want to max out your credit cards because you forgot about decorations, food and travel expenses. Here are some tips for managing these expenses:
- Cash in frequent flier miles, rewards: If you’re traveling over the holidays, explore cashing in frequent flier miles or hotel rewards to minimize the cost of your trip. Frequent flier miles can also often be used on rental cars and other travel-related expenses.
- Have a potluck: Don’t burn yourself (and your budget) out by committing to making everything if you’re hosting a holiday gathering. Instead, make it potluck style, where all of your guests bring a dish to pass.
- Start slow with decorations: Christmas lights and décor are a big part of getting into the holiday spirit – but we’d discourage you from trying to turn your house into Clark Griswold’s in one year. Instead, start slow and consider adding an additional decoration or two in subsequent years. This helps keep your budget in check and gradually will improve the festive look of your home year-after-year.
- Reassess your budget: The holidays are a great time to reassess your spending budget. Hence, analyze things like your cable package, your cell phone plan, your car insurance plan, how often you eat out, your streaming subscriptions, etc. Even if the savings isn’t significant enough to boost your holiday spending budget this year, you’ll likely be saving in the future.
Regards,
Ethan Warrick
Editor
Wealth Authority
