Financial Foresight During Holiday Fun
The holidays are a wonderful time to relax, unwind, and enjoy the company of loved ones. It’s easy to get carried away with spending, but financial responsibilities will continue after the holidays are over. That’s why it’s important to keep savings goals at the forefront during this time of year.
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5 Holiday Mistakes That Could Cost You
By America Saves
Credit reports and credit scores
By Connecticut Saves
The holidays are just around the corner, which means it’s time to enjoy vacations, catch up with family and old friends, and eat great food. While the holidays are about quality time and making memories, it’s easy to get caught up with spending money. Here are five holiday mistakes to avoid this year so you can enjoy the season with your finances intact:
- You’re shopping without a budget or list.
It’s incredibly kind to get each of your relatives, colleagues, and in-laws thoughtful presents and cards to show them your appreciation, but your wallet might be crying for help after your first few purchases. One of the biggest financial mistakes you can make during the holidays is shopping without a spending plan.
When you’re shopping for loved ones, you’re imagining how happy they’ll be when they receive your gift. But remember, financial responsibilities don’t go on vacation during the holidays. Create a budget for your holiday spending. Once you know how much you can afford to spend, create a list that fits your budget.
This way, you’ll be able to purchase the items you plan for and know for sure that you didn’t bust your budget. Here’s a free holiday budget printable to get you started.
- You’re volunteering your home, food, and car to everyone.
If you’re the person that always offers food, transportation, and lodging to everyone, you might want to try a new approach this year. It’s thoughtful to go the extra mile during the holidays, but don’t stretch yourself or your pockets too thin.
Consider splitting the responsibilities with your friends and family. You might not think you’re overspending by being so accommodating, but the more people there are in your home, the more likely you are to receive a high utility bill at the end of the month. You’ll also be surprised at how many trips you might have to make to the grocery store to restock on food, drinks, and toiletries.
You can suggest hosting a potluck style gathering this year. With a potluck, each guest is responsible for bringing at least one dish, beverage, or party supply. At a minimum, you’ll save money on food and drinks. If you need napkins or disposable utensils and plates, you can make one guest responsible for those items as well.
If you have a ton of relatives who need to be picked up from the airport or train station, see if you can rope in other family members to help with pick-ups and drop-offs. This will help you save on gas, time, and energy.
Splitting responsibilities will help you enjoy the holidays without being completely stressed out.
- You’re shopping too late.
So you’ve created your list and a tight budget, that’s great! Don’t wait until the last minute to actually make your purchases. By then, sales may be over and supplies will be limited.
Start your shopping early so you can snag deals while they’re still available. When you have ample time to cross items off your list, you’ll have time to compare prices and bargain hunt. Some stores offer price matching, so keep that in mind as you start shopping and placing your online orders.
Time is of the essence. Shopping early will give you time to figure out what you actually need and get those items at the best price. When you wait until the last minute, you’re much more likely to bust your budget because you’ll just be rushing to cross people off your list instead of specific items that fall within your budget. Here are some tips to help you save while you shop.
- You’re relying on your credit cards.
Do your best NOT to rely on your credit cards during the holidays. If you can’t afford to buy it now, don’t create a bill for yourself later. Once the holidays are over, you’ll be faced with a potential mountain of debt that you’ve built.
The holidays are a great time to enjoy the company of your loved ones, but you shouldn’t feel like the only way to show your love is through expensive presents and festive decor. Enjoy the holidays in a way that doesn’t destroy your finances. This year, make it a goal to spend quality time.
If an unplanned expense does occur during the holidays and you have to use your credit, here are some tips for using your credit card.
- You’re trying to keep up with the Joneses.
Don’t make the holidays a competition about who can wear the most expensive clothes, buy the flashiest gifts, or serve the swankiest dinner. Make the holidays about creating lasting memories and enjoying time with your loved ones, or simply yourself.
Darlene Aderoju works for America Saves, managed by the nonprofit Consumer Federation of America (CFA), which seeks to motivate, encourage, and support Americans to save money, reduce debt, and build wealth. Learn more at AmericaSaves.org.
As the holiday season approaches, do you find yourself looking forward to the festivities, but concerned about the impact on your wallet? You are not alone. By doing some planning now, you can simplify your gift giving. Here are ten ways you can enjoy this special time of year and keep spending in check:
- Food. Consumable items are very popular during the holidays. The recipients may enjoy the product themselves or share it with others when entertaining. Consider special breads, beverages, fruit baskets, snack items, regional favorites, and gourmet coffees and teas.
- Go green. Find locally grown plants, flowers, and dried wreaths. Another option might be to purchase colorful washable napkins, placemats, dishcloths, reusable bags, and lunch bags with individual containers for sandwiches and snacks.
- Set limits. This could be done by establishing a dollar amount per gift, completing your shopping in only one or two trips, purchasing one gift per family, or committing to doing all your shopping locally.
- Made by you. Make your own food specialty. Knit a scarf. Hand craft an item. Create an annual holiday ornament. Give a framed photo.
- Hobby-related gift or gift certificates. Consider the recipient’s hobbies and interests. Are there gardeners, chefs, woodworkers, knitters, readers and gamers on your list? Gift accordingly by providing them with the tools or materials to do what they enjoy.
- Agree on a gift challenge. Discuss this idea well in advance of the holidays with those whom you regularly exchange gifts, but make it fun. You might suggest handmade items only, gifts under $10, one gift for a whole family, limit shopping to consignment or thrift store finds or pick a theme such as useful or consumable items only.
- Purchase the same type of gift for everyone. It could be umbrellas, scarfs, journals, board games, puzzles, nice pens, throws, books, or flashlights and batteries.
- Recipe Book. You could make up a recipe book with family favorites or provide a blank recipe book for the great cooks in your life.
- Coupons for your services. Offer your time and abilities. You can create coupons related to your skills. Perhaps it is cooking a favorite meal, snow shoveling, home repair or an oil change, mending, guitar lessons and so on.
- Create a special memory. Look in newspapers or online for special events this holiday that are free or low cost. Instead of purchasing gifts, make a date with your family and friends to enjoy an event together and get together for desserts and coffee.
Most importantly: enjoy your holidays!
Faye Griffiths-Smith works for UConn Extension, a nonprofit coordinator of Connecticut Saves.
Share the following messages with your followers.
Keep your savings goals in mind while you shop for holiday gifts. #SavingsTipTuesday @AmericaSaves
You can save money and be thoughtful by giving your loved ones handmade presents. #SavingsTipTuesday @AmericaSaves
Holidays should be about spending quality time instead of spending lots of money and building debt for the future #WednesdayWisdom @AmericaSaves
It’s kind to offer food, presents, and accommodations to loved ones during the holidays, but don’t spread yourself or your pockets too thin. #WednesdayWisdom @AmericaSaves
Each time you swipe your credit card for the holidays, you’re creating a bill for yourself later. Follow a budget so you won’t overspend. #SavingsFactFriday @AmericaSaves
Making a list and checking it twice before shopping for the holidays is a great way to track your spending. #SavingsFactFriday @AmericaSaves
From America Saves
- Five End of Year Savings Tips
- How to Avoid Holiday Overspending
- How to Save During the Holidays
- Reducing Financial Stress During the Holidays
- Save Money and Give the Gift of Time This Holiday Season
- ‘Tis the Season for Saving!
- The (Budget-Friendly) Joy of Gift Giving
Resources and Research
Better Money Habits
- Americans With Holiday Debt Added an Average of $1,054, a 5% Increase From 2016, MagnifyMoney (12/28/2017)
- An Early Look at Holiday Spending, Motley Fool (9/17/2018)
- CompareCards’ 2018 Holiday Debt Survey
- Federal Reserve Bank of New York: Quarterly Report on Household Debt and Credit (2017:Q3)
- National Retail Federation: Holiday 2018
- PwC: 2018 Holiday Outlook
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