The winter holiday season is among the most joyful, memorable, and expensive times of the year. If you’re like many people, you’re already starting to feel the financial pressure of buying gifts, getting decorations, booking travel, and hosting festive gatherings.
In this guide, you’ll learn about budgeting for the holidays and holiday spending tips for the season. And if you need a financial boost to make your festive dreams come true, Western Shamrock can help you with an affordable, flexible holiday loan.
Prioritize Realistic Holiday Budgeting
The first practical step in how to save money for the holidays is to create an itemized budget that lists everything you plan to spend money on.
List Your Expected Holiday Expenses
Beyond just gifts, consider decorations, wrapping supplies, holiday outfits, event tickets, dinners out, groceries for cooking, charitable donations, and travel costs. By budgeting for the holidays, you can prepare for extra expenses in advance and avoid last-minute purchases that lead to unnecessary overspending.
Establish Spending Limits Per Category
Once you’ve taken the time to itemize your holiday budgeting, assign a spending limit to each category. This way, you can better understand how much you can realistically spend on each one without jeopardizing your usual bills or delaying your financial goals.
For example, you might dedicate $200 to family gifts, $75 to friend gifts, $50 to teacher gifts, and $40 to coworker gifts. We recommend using a spreadsheet or budgeting app to make holiday budgeting more straightforward to manage throughout the season.
Think About Holiday Budgeting Early
The earlier you start thinking about how to save money for the holidays, the better you’ll likely do with holiday savings.
Open a Specific Holiday Savings Account
One approach to how to save money during the holidays is to open a new savings account that you only use for holiday spending. Even small, consistent deposits add up over time and help you reduce stress in figuring out how to save at the last minute.
You can also set up automatic transfers of even just $10 or $20 per week to help you build a robust holiday savings fund over time.
Consider Physical Cash Envelopes and Digital Budgeting Tools
A tried-and-true method to save for the holidays is to use a cash envelope system. Simply set aside cash into envelopes labeled for gifts, food, travel, clothing, and decorations. Stop spending in that category once the cash is depleted and skip the risks of using credit cards.
Alternatively, you can use budgeting apps and other digital tools to add more flexibility to your holiday budgeting and track your spending in real time.
Holiday Spending Tips to Stretch Your Budget
If you learn how to shop smarter, you’ll be able to maximize your budget and be less restricted in what you can afford during the holidays.
Shop for Gifts Early to Find the Best Deals
Among the best approaches for how to save money for the holidays is to shop early so that you can compare prices and find the best deals. Last-minute shopping often leads to overspending and desperate purchases to meet tight deadlines.
Before you buy anything, do your research to make sure you’re getting the best price – not just the quickest delivery time. You can do this by checking price-comparison tools and online deal trackers, signing up for retailer alerts, and browsing multiple stores in person.
Shop Sales Strategically
Black Friday and Cyber Monday bring enticing sales; however, not every deal is as impressive as it looks. Many retailers also offer the same or better sales at other times of the year.
Shopping strategically involves making a list of needed items, comparing prices, avoiding impulse purchases, and signing up for retailer reward programs.
Remember Shipping and Other Hidden Costs
It’s also essential to understand the full costs of your purchases, including sales tax, shipping fees, rush delivery charges, and return costs. Budgeting for the holidays and planning ahead can help you avoid these extra costs.
Get Creative to Save for the Holidays
It’s also helpful to remember that giving a great gift doesn’t necessarily require spending a lot of money, especially if it’s thoughtful and comes from the heart.
Personalized DIY and Handmade Gifts
DIY and handmade gifts offer a wonderfully personalized touch and are often more meaningful than overpriced, generic items. Some ideas to consider include knitted and hand-sewn textiles, homemade cookies, custom ornaments, framed family photos, and uniquely designed crafts.
Gift Exchanges and Group Gifts
You can also get holiday savings by suggesting White Elephant or Secret Santa gift exchanges to help everyone in your group stick to an agreed-upon budget. Instead of buying gifts for multiple extended family members or coworkers, this approach allows you to buy just one and save money.
Acts of Service Instead of Physical Gifts
Not all gifts cost money and acts of service can be even more valuable than tangible items to the people you love. Examples include cooking a meal, babysitting, pet sitting, yard work, car repairs, or moving help.
Holiday Spending Tips for Travel and Entertainment
Travel costs can really add up around the holidays, so make sure to work trip expenses into your holiday budgeting.
Book Trips as Early as Possible
Book your holiday travel plans as soon as possible to save potentially hundreds of dollars. You can save on flights, hotels, rental cars, and more by setting price alerts on travel sites, using hotel or airline points, and traveling on off-peak days from alternative airports.
Host Budget-Friendly Gatherings at Home
Holiday gatherings don’t have to be over-the-top to be memorable. Focus on what truly matters with a potluck-style event, simple décor, and good old-fashioned quality time together.
Reduce Your Holiday Debt
In addition to these holiday spending tips, it’s also crucial to keep an eye on your accumulating debt load around this time of the year.
Use Cash to Avoid Interest
If you pay for holiday costs in cash, you can avoid high-interest credit card debt that can lead to stress and financial regret.
Regularly Monitor Your Spending
During the holidays and all throughout the year, keep track of your spending by checking bank statements weekly and using budgeting apps that send you alerts when you exceed a spending limit.
Start Thinking About Next Year…Yes, Already!
It’s never too early to start thinking about next year, so you’re not scrambling to figure out how to save money for the holidays all over again.
Start a Holiday Fund in January
Make a New Year’s resolution to start a holiday fund to kick off the year and remove financial pressure when winter settles in next time around.
Shop for Gifts and Supplies in the Off-Season
After the holidays, take advantage of clearance sales to stock up on wrapping paper, gift bags, decorations, and cards. Many retailers offer 50% to 90% off the listed prices after December, helping you be well-prepared for next year.
Need Extra Cash for Holiday Expenses? Consider a Holiday Loan
Ultimately, it’s entirely possible to figure out how to save money for the holidays without sacrificing your favorite traditions or draining your wallet. But if you’re still coming up short on cash for holiday costs, Western Shamrock can help.
Our holiday loans come with fixed monthly payments, a predictable payment schedule, and affordable rates. It’s easy to apply for a holiday loan online or in a local branch. We offer quick approvals and friendly customer service to help you embrace the magic of the season.
