The holiday season often makes for the most expensive time of the year. Between travel costs, buying gifts, and planning lavish meals, it can add up fast. Budgeting in advance can help – and there are always ways to save money on holiday costs. If you’re trying to figure out how to budget for holiday spending, here are some tips.
Be Realistic from the Beginning
Once the holidays start approaching, many people start dreaming of everything they’ll get for their loved ones, how they’ll transform their homes, or what their perfect holiday vacation will involve. However, it’s easy to get caught up in the holiday fervor, and that can lead to overspending.
Before the holiday season arrives, sit down to review your budget. Be realistic about what you can and can’t spend. If it helps, outline your spending capabilities. Assign a dollar amount to each gift recipient, outline what you can afford to shell out for holiday meals, and see what you can potentially pay for travel. While it takes a little time, it can keep you from overextending, reducing the odds that you’ll need to turn to debt.
Set a Small Amount Aside Every Paycheck
Whether you’re worried about travel costs, food expenses, or gift buying, setting a small amount of money aside from every paycheck makes holiday budgeting easier. You can build up your savings over the course of a few months or an entire year, so you don’t have to pull it all from just one or two checks.
Before you start, estimate what you’ll need to spend. Set price limits for gifts as a starting point, outlining how much you’ll spend on each person. Then, factor in other expenses, such as travel and meals. Divide that figure by the number of paychecks you’ll have between now and when you need to shop, then stash that amount of cash.
Plan Gift Buying Around Paychecks
If you’re worried about gifts, another excellent option is to divide up your gift purchases between your remaining paychecks. This allows you to spread out your holiday spending, which can make it more manageable. Plus, it could create opportunities to score some deals if you happen to catch a sale.
While you can use this strategy over the course of a few months, it’s also possible to stretch it out over an entire year. With that option, you can capitalize on discounts that don’t happen during the holidays, allowing you to save even more.
Don’t Rely Solely on Black Friday or Cyber Monday
The hype around Black Friday and Cyber Monday makes it seem like those are the two days with the best deals. In reality, holiday season discounts on other days can be just as good, if not better.
Review sales flyers or online advertisements before these events to see if there is a deal on the exact items you want. If there are, then you can try to scoop them up. But if not, keep your eyes open, as there’s a chance the gift you’re after will go on sale before the holidays happen.
Book Holiday Travel by Early to Mid-October
Last-minute travel bookings often cost more than if you plan ahead. If you know where you want to go, try to book your flights and accommodations in early to mid-October. You’ll have more options available than if you wait, and the prices are usually better. Plus, it’ll knock one more thing off of your holiday to-do list, which can be a relief.
Be Wary of Discount Airlines
Some discount airlines advertise very attractive prices. The issue is that once you start to move forward, you encounter a ton of fees and extra costs, driving the total up.
While you can certainly look at discount airlines, make sure you account for the fees. Then, compare the cost to a more traditional airline to see if you genuinely come out ahead. If not, then you may want to choose an airline with more straightforward pricing.
Arrange Secret Santa Exchanges
If buying for all of your family members or friends might be a budget buster, reach out to everyone and see if they’d be interested in a Secret Santa exchange instead. With those, all participants only purchase and receive one gift, which makes it budget-friendly. Plus, the mystery can make it a little fun.
Another nice feature of a Secret Santa is that everyone usually has the same purchase limit. In some cases, since you’re only buying for one person each, that may allow you to spend more on a single gift while still keeping everyone’s budget on target.
Price Check on the Go
Even if you think the price for a gift or meal item is reasonable, don’t be afraid to price check while you’re on the go. Use your phone to see if other area stores or online retailers are selling it for less. If so, you can see if the store you’re at has a price-matching program. If they don’t – and the savings is significant enough – then you can always head elsewhere to complete the purchase.
Review Your Regular Household Budget
If you’re worried about holiday expenses, don’t focus solely on budgeting for those costs. Instead, take a look at your regular household budget and typical spending patterns. Find opportunities to reduce your expenses, at least temporarily. Scale back on dining out, cancel a streaming service or two, and make other small adjustments to give yourself some breathing room. In the end, you can always start things back up after the holidays if you want, so treat it like a holiday pause and use the cash to handle your travel, gifts, and more.