Part One: Make a Plan
Let’s face it. 2020 has been a long and rough year. Still, it feels like the holiday season has snuck up on many of us. Yet, it’s almost time to deck the halls, put together those shopping lists and celebrate enjoy some holiday feasts.
With all the excitement of finally having something to celebrate this year, it can be easily to lose track of how much money we’re spending on all the holiday hoopla. With all of 2020’s uncertainly and with millions of people who have lost jobs due to COVID-19, money is on many people’s minds during this festive time.
The National Retail Federation did their annual survey on holiday buying trends for 2020 back in October. In this survey, shoppers said they plan to spend an average of $997.79 on food, decorations, gifts, and other purchases this year. That number is about $50 more than last year, according to the NRF.
If you’re one of the people looking to save some money this holiday season, then we’re here to help you out! In our first post on holiday savings’ strategies, we’re going to focus on the most important part of your holiday financial to-do list: Make a plan!
Setting a budget or a plan may sound like a Grinchy thing to think about during the holiday season. But, trust us on this one. If you don’t want late December and early 2021 to be not-so-jolly thanks to huge credit card bills or buyer’s remorse, then you need to take the time to plan your expenses before you start shopping. You don’t need to be like Ebenezer Scrooge with your spending; just a little smarter!
It just takes four steps to figure out the best budget for your holiday season this year.
Step one: Write down all the holidays you’ll be celebrating and what you’ll need
For some reason, many people don’t plan for all the holidays from November through January. The focus is typically on Christmas as the big expense, but Thanksgiving with all its food and fixings can get pricey, whether you cook it at home or decide to order it from a service.
Then, there are all the celebrations that happen throughout the month. Even though COVID-19 is still an issue, there will surely be multiple occasions where you’ll be baking goodies, exchanging or mailing gifts, cards you’ll want to send, etc. The celebrations often go through New Year’s. Think of everything you can so you can account for it when you’re trying to estimate how much it’s going to cost you.
Step two: Take an honest look at your personal budget
Before you start making your shopping lists, you need to take some time
with your online bank app or statements and get real about what’s in your accounts. The holidays are not a good reason to go into massive debt, especially in a time of economic uncertainty. That’s not to say that using a credit card is a bad choice. We’ll talk more about how you can actually save money using your card in our next post.) But, if you cannot reasonably pay off your balance quickly after the holidays are over, then don’t rely on them to buy your gifts and other necessities this season. In other words, if you don’t (or won’t) have the money in your bank account to pay your bills in January, then think twice before using them for extravagances.
Step three: Look at everything on your list with a critical eye
Half the fun of the holidays is shopping for gifts and all the delicious food. But, it adds up quickly. If the thought of spending nearly $1,000 on extras over the next two months is freaking you out a bit, then look at the lists you’ve created for holiday food, gifts, décor and set some priorities. Do you really have to have every single side dish at every holiday meal? Do you need to buy a gift for every member of your extended family this year? Can you re-purpose some of your favorite holiday decorations to give them a new look? A quick Google search can show you many websites with ideas to give your decorations a brand new life, including Sadie Seasongoods! Plus, these can be some fun family activities to do on those cold December nights.
Step Four: Set your holiday spending limit
Once you’ve prioritized your list and taken an honest look at your current financial situation, set a spending limit for the holiday season. Make sure your goal is reasonable, so you don’t feel like your scrimping all season. Your goal is to stay at or under that number so you’re not dipping into personal savings or maxing out your credit card. Remember, we don’t want a holiday money hangover in that starts in January 2021.
In our next post, we’ll share ways you can actually save money when shopping for your personalized Christmas list! From big ticket items to small, yet meaningful gifts, we’ll have plenty of ideas on how to maximize the money you spend for the 2020 holidays!