How to Avoid Overspending on Holiday Gifts
These shopping tips will help the holidays feel more like a time of saving.
It’s that time of the year where all too often, Americans find themselves with more financial worry than holiday cheer. If you’re looking to make the most of your holiday budget, here are several tips to help you avoid overspending.
Outline a Holiday Shopping Budget
We all know the holidays are a time of giving, but that doesn’t mean one should give more than they can afford. It’s important to establish a holiday budget and set parameters around what you can and can’t set aside. This could save you from splurging hundreds of dollars down the road. Many experts recommend allocating no more than 1% of your overall income toward a holiday budget. If your total household earnings are $100,000, your budget should not exceed $1,000.
Consider that a holiday budget is not exclusive to gifts. Other expenses such as food, decorations, wrapping paper, travel, and charitable donations should also be accounted for when setting a budget.
Make a List (And Check It Twice)
There are several benefits to preparing a shopping list in advance. By knowing who you’re shopping for and what you’re getting them, you’ll be able to ensure your prospective purchases fall within budget. This also steers shoppers away from making impulsive purchases that could foil their budget in a single transaction.
Gifts For Thee But Not For Me
In the context of holiday shopping, “one for them, one for me” has become a growing consumer behavior. If shoppers want to limit their spending during the holidays, self-gifting needs to go. Nonetheless, an alternative is postponing self-indulgences until after the holidays while taking advantage of post-Christmas bargains and retail discounts.
Know Where to Shop
It pays to be a little savvy. Do some research on what retail shops are offering the best holiday promotions and discounts. Some stores even have better deals than their Black Friday offerings, and many release discounts nearly every week leading up to Christmas. Use these to your advantage.
No Gift Is Worth Financial Hardship
Many shoppers will find themselves using a credit card for holiday shopping. If this is the case, it’s critical to have a plan for paying it off. If a purchase will prompt financial anxiety, spend less.
If you’re looking for alternatives to gift giving, we have a list of ideas to get you in the holiday spirit here.
In the Spirit of Saving, Open a Savings Account with Bank of Colorado
With smart budgeting, you can enjoy this holiday season while building savings for the future. At Bank of Colorado, we’re here to help you make the most of every dollar with savings accounts that goes beyond just holding your money. Our savings accounts can help you reach your financial goals, whether it’s for next year’s festivities or long-term plans. Learn More.