PWC expects American consumers to spend 7% more this holiday season compared to last year, with an average of about $1,530 per person for gifts, travel, and entertainment. This increase means that 40% of consumers will likely spend more than they did last year.
With rising costs, holiday spending can strain your finances and emotions. Creating a holiday budget can be challenging, especially if your friends and family don’t share your financial habits. But if you’re excited about the holidays, here’s a plan to enjoy them without going broke. Follow these seven rules to get the most out of your financial resources during the holiday season:
1. **SET YOUR HOLIDAY SPENDING LIMIT**
Decide on a budget for holiday expenses before you start shopping. Look at your financial situation and set a realistic budget. Make sure the money you plan to spend on gifts doesn’t affect your regular bills. If you want to spend more, save extra cash that doesn’t impact your monthly rent, so you stay financially stable.
2. **MAKE A LIST AND STICK TO IT**
Avoid overspending by following a pre-set budget, especially during the holidays when shopping is in full swing. List your main gift recipients and how much you plan to spend on each. Start buying presents early to spread out your spending and prevent a large financial hit later.
3. **TAKE ADVANTAGE OF EARLY SALES**
Don’t wait for big sales events like Black Friday and Cyber Monday. Top sellers often offer discounts well before these dates. Shopping during off-peak times can help you find the items you want at lower prices and avoid the holiday rush.
4. **SHOP AROUND FOR THE BEST DEALS**
To get the best value, look for sales, discounts, and promotions. Use apps and websites to compare prices. Research prices because some online stores may offer better deals.
5. **CONSIDER ALTERNATIVE GIFTS**
Choose more affordable options like handmade gifts, experiences, or charitable donations instead of expensive presents. Spending time with loved ones can be very meaningful, especially if they live far away.
6. **MAKE YOUR OWN DECORATIONS AND WRAPPING PAPER**
Americans spend about $3.2 billion on gift wrapping each year, according to Hallmark. Save money by making your own decorations and wrapping paper. It can be a fun activity and cheaper than buying expensive materials.
7. **RECYCLE, REDUCE, AND REUSE**
Choose durable and eco-friendly gifts to reduce waste and costs. Look for items with minimal packaging or those that help the environment, like a reusable water bottle or a solar phone charger. Homemade treats can also make great gifts. Try to recycle packaging materials when possible.
**CONCLUSION**
Setting financial limits for the holiday season is a smart way to manage your money. It allows you to enjoy the festivities without harming your finances. This approach helps avoid overspending, financial stress, and post-holiday debt. It also supports your long-term financial goals by preventing impulse buys.