11.07.2024 By Amy Miller, AFC®

Reduce Holiday Stress by Keeping Your Finances in Check

The holiday season is filled with joy, celebrations, and family time, but it can also bring financial pressure. Between gift-giving, hosting events, and traveling, the expenses can add up quickly, leaving many people feeling stressed about their finances. However, with a few mindful strategies, you can enjoy the holidays without the financial strain.

 

Here are 10 ways to reduce holiday stress and keep your finances in check:

1. Create a Holiday Spending and Savings Plan

One of the most effective ways to prevent holiday financial stress is by planning ahead. Set a realistic holiday spending and savings plan that includes all anticipated expenses and specific amounts for each category, such as gifts, food, decorations, and travel. By establishing a plan, you can avoid last-minute purchases that can put a strain on your finances.

Saver Tip:  Use our spending and savings tool to track your spending throughout the season.

 

2. Make a Gift List and Stick to It

Impulse buying during the holiday season is common, especially when faced with holiday sales and marketing. Combat this by creating a list of people you plan to give gifts to and deciding on an amount to spend on each person. Do your best to avoid adding extra names at the last minute, which can blow your plan.

 

3. Shop Smart and Early

The earlier you start your holiday shopping, the more opportunities you have to find deals and avoid the last-minute rush that often leads to overspending. Take advantage of Black Friday, Cyber Monday, and other seasonal sales, but be sure to compare prices to ensure you’re getting the best deal.

Consider buying in bulk for group gifts and stocking stuffers, taking advantage of free shipping offers (but don’t let it tempt you into buying more than you need), and consider using cashback apps and store programs to earn rewards points on your purchases.

 

4. Avoid Using Credit Cards for Holiday Spending

It can be tempting to rely on credit cards during the holidays, especially with enticing offers and reward points. However, relying heavily on credit cards can lead to post-holiday debt and interest charges that linger long after the season is over.

If you must use a credit card, make sure you have a solid repayment plan in place to avoid carrying a balance into the new year.

 

5. Embrace DIY and Thoughtful Gift Giving

Rather than spending hundreds of dollars on store-bought gifts, consider making homemade gifts or giving meaningful experiences. DIY gifts, such as baked goods, hand-knitted scarves, or framed photos, often have more sentimental value and can save you money.

Additionally, giving experiences—like a planned day out, a home-cooked meal, or tickets to a local event - can create lasting memories and avoid the costs associated with material items.

 

6. Host Affordable Holiday Gatherings

If you're planning to host a holiday gathering, the costs for food, drinks, and decorations can quickly add up. To keep expenses low, consider hosting a potluck, or choose affordable ingredients and dishes that can feed a large group. You can also repurpose last year’s decorations – chances are, no one will notice you’ve used them before.

 

7. Travel Smart

If your holiday plans include travel, be strategic about when and how you book. Book early and look for discounted flights or alternative transportation methods, use travel reward points or miles if possible, and travel during off-peak times (midweek or early morning) to find better deals. You can also consider staying with friends or family instead of booking expensive hotels.

 

8. Plan for Post-Holiday Expenses

Once the holidays are over, bills can start piling up, leading to financial stress in January. A good way to prepare for this is by setting aside a small amount of money from your holiday budget to cover any unexpected costs, like higher-than-expected utility bills from holiday gatherings.

 

9. Focus on the Meaning of the Holidays

It’s easy to get caught up in the commercial aspects of the holiday season, but it’s important to remember that the holidays are about spending quality time with loved ones and creating lasting memories. By focusing on the experiences and people that matter most, you can reduce the financial pressures that can come with the season.

 

10. Start a Holiday Savings Fund for Next Year

As you prepare for the holidays this year, it’s never too early to start planning for next year. Consider setting up a holiday savings account and contributing a small amount automatically each month throughout the year (it’s the easiest way to save). This way, you’ll have a financial cushion in place by the time next year’s holiday season arrives, and you’ll avoid the stress of trying to cover all expenses at once.

 

By taking proactive steps to manage your holiday finances, you can enjoy the season without the stress of overspending. Prioritize thoughtful, financially friendly traditions and focus on what truly matters—spending time with those you care about. This holiday season, America Saves encourages you to work toward a financially strong future by making the best financial choices for you and your family with less stress and more joy. Happy Holidays!

 

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Start the holiday season by taking the America Saves Pledge, pause for a check-in, and get a clear view of your finances. Pick your savings goal and we’ll be your partner along the way and will send tips, tools, and resources to keep you motivated.

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