The holiday season is the time to give and stores sure like to put you in that spirit. Retailers couldn’t wait for Halloween to be over so they could put out their holiday decorations. Oh! and it’s not retailers only, one of our local radio stations has already started playing holiday music! I thought the earliest they got started was after Thanksgiving. The incentives are clearly there to put us in the spending spirit. And it’s so easy to spend isn’t it? store catalogs, store sales, manufacturer’s promotions. It feels like the making for a perfect storm. To help you keep your spending under control consider the following tools:
1) Before you do any more gift spending this season, sit down and figure out how much you can truly afford. I found a guideline online to spend 1.5% of your annual income ( I am not even going to go into how little sense that makes to me considering the national savings rate is negative, but whatever). However, figure out how much it makes sense for your family to afford. Consider your particular situation: if there has been a layoff in the family, income lost, additional expenses, or maybe you have a nice bonus coming to you soon. Maybe you are counting on a nice tax refund to help pay for this year’s gifts.
2) Once you have determined how much you can afford to spend, make a list of all of the gifts you need to get and how much you would like to spend. Reconcile this list with your budget and determine if you need to make any changes to your list in order to meet your budget.
3) Do not be afraid to cut back on the number of people you are gifting or the amount you are spending on some people. Some ideas are:
-Instead of giving gifts to each one of your siblings and their children consider drawing names. In my family, we only give gifts to the children, no longer to my siblings.
– Consider cashless gifts. With a newborn coming soon to my household the best gift anyone could give me is the gift of time. Offer to bring me a homemade dinner for my family, or maybe just come and visit while I get stuff done around the house. Consider doing this also with older relatives. They probably appreciate more you coming over to visit and helping with household chores or maybe doing their holiday shopping for them. Help is an often overlooked gift and it’s probably one of the most appreciated.
-Consider homemade gifts. I know a lot of people are considering this in the advent of all of those toy recalls. For more frugal gift ideas check here and here for additional information.
4) Consider cheaper shopping alternatives: Online retailers can offer significant savings this time a year. They know they are at a disadvantage with brick and mortar stores because it’s more difficult to draw you in to their website or put you in the holiday “spendy” mood. Also, another advantage of online shopping is that it can help in controlling how much you spend. You are more likely to look just for the item you are interested in, instead of wandering around retail displays and picking up additional impulse buys. Also, try shopping outlets. I personally love outlets. I do most of my clothes shopping there.
5) KEEP TRACK OF YOUR SPENDING. This is very important if you want to stay within budget. The purpose of a budget is to serve as a guideline. If you set one and don’t come back to see how you are doing against it then it’s purpose is lost. Reviewing your budget will help you make adjustments and stay on track.
I hope these ideas help you stay on budget this holiday season and make sure above all you spread love and cheer all around.
