7 Ways to Save Money During the Holidays
By: iThink Financial | Dec 01, 2022
Every year, the amount of money Americans spend during the holiday season increases; in 2022, shoppers are expected to spend over 940 billion dollars on retail purchases. Whether it be gift-giving expenses or experiential costs like vacations, the holidays can put a massive dent in our bank accounts.
Fortunately, saving money during the holidays is possible if you make a point to do so. With the right amount of financial planning, you can get through this period of assumed mass spending without losing a big chunk of your savings. Keep reading for 7 ways to save money in a season of spending.
Make a Budget
The simplest way to ensure you are cutting back on spending is to make a spreadsheet or some other budget setup that lets you allot a certain amount of your income for each potential expense. This includes holiday costs, gifts, vacations, and your “regular” budget. For example, you may normally spend X amount of money on groceries, but that will likely change during the holiday season. If you’re expecting to host any dinner parties or have family stay over, consider how much money you will need to add to the grocery budget.
This is important because it will help you keep track of where your money is really going. If you forget to add areas like groceries to your budget during the holidays, you might find yourself in a bind when calculating how much you can spend on gifts and other expenses you originally planned for. The point of a budget is to limit yourself from spending too much, and the more accurately it reflects how much you’ll need to spend, the more likely you are to follow it.
Your holiday season budget may sometimes look different too. Take into account what one-time purchases you might make that will last for the next few years. Will you—or your children or spouse—need new jackets? Are there any appliance upgrades or renovations that need to get done during this time?
While some purchases are longtime investments and not a part of your normal budget, the holiday season could be the perfect time to find a deal that will save you money in the long run.
Take Advantage of Holiday Sales
With all the sales going on during the holiday season, you can end up saving money in areas you wouldn’t even think about. Black Friday and Cyber Monday sales are just the beginning of holiday savings. You can find deals for just about anything.
Some additional times to find holiday sales are right after the holiday itself. The post-Christmas period sees massive sales, as stores aim to clear their stock for the new year. If your household needs a new artificial Christmas tree, the day before or after Christmas will likely yield the best deal.
Be Careful of Overspending
One of the problems with sale shopping, however, is that people tend to overbuy. The appeal of discounts may convince you that you really need to buy x, y, or z because if you don’t, you’ll end up paying more later on. However, this is often just a marketing tactic.
This is why your budget is so important. Don’t shy away from sales, but make sure you don’t overdo your spending. Ask yourself if you really need the item you are tempted to buy. A good trick is to ask yourself if you would buy it if it weren’t on sale. If your only reason for buying the item is that it’s on sale—with some exceptions, like food items that you will end up using—you may not want to make that purchase. Impulse buying is one of the biggest reasons people overspend during the holiday season.
Also, be sure not to have blind trust in every sale you see. Faux sales will sometimes make you think you’re saving more money than you actually are. Consider how much their discount is actually going to be saving you as opposed to buying that product elsewhere under a different brand. Think critically to avoid unnecessary overspending.
Avoid Gift-Giving Rabbit Holes
How big is your “to shop for” list? When you start thinking about who you may need to buy gifts for, it can be incredibly easy to end up with a long list of people you now feel obligated to gift. Friends and family are a start. Do you have any work friends or colleagues you want to treat? Your boss, neighbor, or child’s teacher? The names can really rack up.
Instead of falling down this rabbit hole, don’t be afraid to cut down your shopping list. If you are not financially comfortable spending money on every person you know, it’s okay. There are other ways to show your appreciation for them, such as spending time with them or sending a heartfelt holiday card.
For work-related gifting, consider participating in Secret Santa or White Elephant instead of buying something for every member of your team. This will limit you to a single gift rather than multiple, and you still have the option of getting something small for everyone if you so desire.
Additional Ways to Save on Gifts
● Shop second-hand
● Make something with materials you have on hand, such as baked goods
● Regift unused and unopened items you have received or bought in the past
While some holiday savings will leap at you from billboards, screens, and other forms of advertisements, other savings can be something you find yourself. Couponing can work digitally, through websites like RetailMeNot, or physically, through newspapers, magazines, and mailed advertisements. Consider investing in a coupon book if you have a lot of holiday shopping to do.
If you are an online shopper, there are browser extensions that can find you online codes and promotions. One of the most popular is Honey, but you can also find alternatives like Shopper.com and Rakuten.
You can also do a little research to see if any coupons stack on each other. Many retailers will limit you to one coupon or exclude already discounted items from additional coupons, but some allow more discounts to be applied. You can also check to see how strictly they follow their coupon expiration dates. Bed Bath & Beyond, for example, notoriously accept in-store physical coupons beyond their marked expiration date.
There may also be additional savings that apply year-round that you didn’t know about. There are certain groups who can receive an additional discount on their purchase with the right form of ID. For example, this might apply to you if you’re a student, senior, or member of the military.
This can come in handy when gift shopping but can also save you money year-round. If you fall under one of the common discount categories, check with the places you commonly shop to see if you could be saving even more.
Analyze Your Expenses From Past Years
When planning for the future, it’s often smart to learn from the past. What steps have you already been taking to reduce your spending during the holidays? If you’re hoping to save more during the holidays because you tend to overspend and have done so in the past, you can break down where you’ve been falling short and work to overcome that.
For example, perhaps you have a problem sticking with your budget. If you don’t follow the guidelines that you set for yourself, try finding ways to hold yourself accountable. Budgets don’t work if you don’t hold to them. Did you use your credit card without enough caution and end up with credit card debt? The nature of credit cards requires users to be very conscious of how they spend—otherwise, it’s easy to be overconfident and spend more than you actually have.
Perhaps you didn’t account for unexpected expenses when you were budgeting or didn’t give yourself enough money to work with. Maybe you didn’t even budget at all. Whatever the problem might have been in the past, remedy that first.
Find New Sources of Income
If you feel yourself being spread too thin financially, you may need to increase your income to match the needs you and your family have. Potential sources of income include:
● Commissions-based work
● Odd jobs around the neighborhood
● Working overtime
● Taking on a second job
Some of these definitely require more time and commitment than others. If none of these options are possible for you during the holiday season, you can also try taking action earlier in the year. For example, start saving for the next holiday season right after the last one ends, or take on a few odd jobs over the course of the year to build up your holiday funds.
Become an iTHINK Financial Member
Finally, joining iTHINK Financial can help you plan and save money for the future. We give you personalized customer service and can help you with digital banking, credit card applications, checking and savings accounts, loans and mortgages, insurance plans, and much more.
Contact us today to learn more about what we offer and how we can help you save money during the holidays and beyond.