According to the National Retail Federation, the average American spends about $700 on gifts each holiday season. If you have multiple kids, it could be even more. Depending on how big your family is or what tax bracket you’re in, that could seem excessive or like just a drop in the bucket of your reality. Most people, though, will admit that having a holiday spending budget is incredibly important — not just for keeping their family afloat but for their own mental health, as well.
But we all know setting a budget is one thing, keeping that budget is another. Luckily, there are some really effective shopping strategies you can use to help you not blow your budget during the holidays. The most important thing you can do in November and December is make sure you reach January without a spending headache.
1. Set A Budget Early
If you have a big family, you’re going to need to spend more money in the end. Starting earlier, however, will help lessen the strain put on your bank balance in the final quarter. What’s this look like? It could mean spending New Year’s Day sitting down and figuring out how much you spent last year. Take that number and divide it by ten. Yes, ten. Then, you know exactly how much money you need to save between January and October in order to have a reasonable budget for shopping in November and December.
2. Start Shopping Early
Another way to start early is to start buying during those post-holiday sales and throughout the year. It’s hard to plan for kids — who knows what the big trendy toy will be twelve months later. But, you can plan to buy your Bath & Body Works-loving sister some smell-goods during their semi-annual sale. If you always fill stockings with socks, craft supplies or hobby-adjacent small ticket items, you don’t need to wait until the last minute for those, either. Nab the Harry Potter sock advent calendar on clearance for 70% off on January 16. Then use them for stocking stuffers when December rolls around. When Target offers one of those amazing “Circle” deals where you spend $20 on Arts and Crafts and get a $5 gift card, go buck wild on colored pencils, acrylic paint or washi tape. You can even cash in your credit card reward points from this Christmas’ shopping sprees to nab a few gift cards to use (or gift) for next year.
3. Be Realistic With Your Budget Upfront
We often set budgets with the best of intentions. You go in thinking, “I’m not spending more than $25 per sibling.” Meanwhile, you’ve never spent less than $50 for your brother since you had your first job. You can plan on hoarding toys, books and clothes throughout the year for the ultimate present for your kiddos. But, what if Madison hits a growth spurt in September? You’ll need to dig into your stockpile for school clothes and then buy more stuff come November. Or worse: What if your tween breaks his old bike or Microsoft releases some insanely cool new XBOX that two-thirds of your family is desperate to have? Buy ahead when it’s practical but, most importantly, set yourself up so it’s safe to splurge… without going into debt.
4. Don’t Forget Anyone Or Anything
When you’re budgeting, don’t just think about the big gifts for family members, think about all the smaller and less flashy ways you spend money on the holidays. Think about the extra special holiday tips you’ll want to give service workers (even if it’s just a tin of popcorn for the workers at your mom’s nursing home). What about your kid’s math tutor, or the teen down the block who always babysits last minute? What about your preschoolers teacher and two teacher’s assistants? What about the three December birthdays in your family that all hit before Christmas? Don’t forget your kid’s ancillary teachers, sports coaches, your kid’s friends who might get a gift.
How much did you spend on Thanksgiving and Christmas dinner or that trip to see the lights at the zoo? How much did those eight days of Hanukkah trinkets cost you? Do you always end up buying extra decorations? From the angel or new menorah candles to the wrapping paper, make sure you budget for all aspects of holiday spending so they don’t blow your holiday budget before the holidays even begin.
It’s best to write this list down come January while all the little expenses are fresh in your head. This way, come September, October, and November you’re not scrambling to find extra funds for expenses other than gifts.
5. Set Rules For Your Whole Family
If you can’t afford to buy presents for your sister, her husband and their six kids, make that known as early as possible and get everyone on the same page. Maybe the rule is as simple as, “Only buy for the kids” or “Don’t buy for the kids.” Maybe try a name exchange where adult siblings exchange names and cousins do the same. If you’re married with one kid, you’ll buy three gifts and get three gifts. If your parents were the ones with six kids, suggest buying “family gifts.” You should definitely suggest a spending amount, too. Our family loved getting the gigantic, personalized Hershey bar one year. And, when we moved from Florida to Ohio, we always looked forward to the crate of oranges and grapefruit sent from “back home.” As long as everyone is on the same page, you won’t feel the need to be embarrassed by not buying “as much” as another family member.
6. Make A List, Check It Once
Once you make your list of necessary gifts, keep it handy at all times. The best way to not blow your holiday budget is to keep it in front of you. Use a budget app or start an email chain. If, in March, you purchase a new B&BW Wallflower and a collection of scents for your sister, cross her name off that list. Don’t stop to admire the adorable owl figurines you know she’d also love. Put blinders on when you see a new women’s clothing collection drop in August, even if it’s in her favorite shade of plum. You have her present. You spent two hours sniffing candles and considering her bathroom decor. Don’t fall victim to the “something better.” Once you’ve crossed a name off your list, don’t revisit it. Don’t be like Santa, don’t make a list and check it twice.
7. Consider No-Spend Options
Yes, we mean crafting and regifting. Would your sentimental younger cousin appreciate the collection of fun-shaped candles from the grandma you share, but that she never met? They’re just collecting dust in your attic. What about your sister who’s first baby is due in February? Could you knit or crochet a baby blanket in her nursery colors? Buying some soft yarn is way cheaper than a whole layette set from a department store and it’ll be a gift she cherishes for ages. Or maybe your niece just discovered a love for baking and you have your mom’s old recipe box. Whether you share the originals or just photocopies, she’d probably love being let in on all the family favorite recipes.
8. Give Experiences
Every year you buy yourself a family zoo membership that includes five free guests per visit and a 25% discount on additional tickets. Instead of buying your sister’s family presents, give them “tickets to the zoo.” This can look like actual tickets for them to go on their own. Or it might just be an invite for them to go with you in the spring. For a tangible, wrap-able present, consider making up some fake tickets or buying two inexpensive stuffed zoo animals. Supply the picnic or spring for pizza once you’re there.
9. Don’t Use Credit Cards
No matter who you ask for spending advice, all experts agree on one thing: Using credit cards is a bad idea. After all, whether you’re spending in cash or credit, if you go over the limit you set for yourself, you’re still blowing your holiday budget. Unless you’re one of the incredibly organized few who will use a credit card for points and then go home to pay it off that night, the early benefits don’t outweigh the looming debt you’ll have hanging over your head come January. If you can pay cash, use cash. If you can’t pay cash, find ways to pare down your “To Gift” list.
Quotes about budgets and how to stick to one
“Don’t tell me what you value, show me your budget, and I’ll tell you what you value.”
― Joe Biden
“We must consult our means rather than our wishes.” ― George Washington
“Budgeting has only one rule: Do not go over budget.” ― Leslie Tayne, Life & Debt: A Fresh Approach to Achieving Financial Wellness
“A penny saved is worth two pennies earned . . . after taxes. ” ― Randy Thurman
“See money – currency – as the flow of energy and giving that cycles between you, others and me. Now let it flow kindly, fairly and mindfully.” ― Rasheed Ogunlaru
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