Money Saving Tips

How to Save Money for the Holidays

How to Save Money for the Holidays
Written by Irina Vasilescu

Thanksgiving, Christmas and New Year are occasions that people most look forward to. It’s that time of the year when one party after another is held, when holiday cheer is spread all around and families get together to bond. However, alongside the fun also comes the stress of going holiday shopping.

If you’re single and you haven’t seen your mom for the entire year, you’d want to buy her something nice for Thanksgiving or Christmas. The same thing holds true for your other family members, friends, significant other and colleagues in the office. The holiday season is also that time of the year when merchants hold huge sales for the products that they sell.

Here, we will be dishing out tips on how you can save money during the holiday season, and have a quick look at the real cost of your holiday shopping. If you want to find out how to save money for the holidays, keep on reading!

Understanding the Cost of Your Holiday Shopping

Before learning how to set a budget for your holiday shopping, let us first understand the real costs involved in buying gifts for the holiday season. Take a look at some statistics based on Accenture.com’s 2013 US Holiday Shopping Survey:

  • People will spend between $250 and $500 on holiday shopping.
  • Shoppers are willing to spend more on their holiday shopping for the current year as compared to the previous one. However, spending is expected to lower as compared to prior years.
  • People are spending more for their holiday shopping due to the following reasons: they want to treat themselves and their families after a tough year; the cost of items have increased; they have more income to spend; they want to spend more freely this year; and they have more job security as well as fewer concerns about the economy.
  • Most people are willing to set a budget at the start of the holiday season.
  • 34% are very likely to overspend on their holiday shopping budget.

Based on the number of survey respondents who are very likely to overspend on their holiday shopping budget, you more or less have an idea about how you should go about your own holiday shopping expedition.

Depending on your current financial status, you can splurge just a bit as compared to what you spent last year, although you still need to find items that will give you the best value for your money. If you’re tightening strings as far as your budget is concerned, then there are plenty of ways for you to do just that.

Ways to Save Money for the Holidays

To give you an idea about how you can save money during the holiday season, take a look at the following tips:

Set aside funds specifically for your holiday shopping

Even a $300 holiday shopping budget can put a huge dent in your finances, especially if you are living on a paycheck-to-paycheck basis. To make sure that you are more than capable of starting the New Year debt-free, what you can do is set aside funds for your holiday shopping.

You can use a piggy bank, a separate savings account or any other means of setting aside funds for your holiday shopping. The key here is to start saving early so that you can give your holiday shopping fund a boost.

Make a list and start shopping early

Once you already have an idea about the ballpark amount that you can save for holiday presents, make a list and start shopping early. When making a list, write down the names of every person who you would like to give a holiday gift to.

How much are you willing to spend for each of them? If you really know the recipient of your gift, you would have more or less an idea about what he or she would like, and think of a thoughtful present from there. No matter how small the costs of the items are, list it down because the expenses will eventually add up.

Exactly how early should you start with your holiday shopping? Throughout the year, whenever you see items on sale which you know would make for a great holiday gift for someone you know, go ahead and buy it and put it in a holiday presents box.

This way, you won’t have to rush through the process of buying everyone gifts for the holidays. Not only that, but you can also manage your finances better because the funds will get spread throughout several months. But if you were unable to do your holiday shopping way in advance, you can hit the stores right before Thanksgiving.

Take advantage of holiday sales

As mentioned earlier, merchants take full advantage of the holiday rush by holding huge sales prior to, during and even after Thanksgiving, Christmas and New Year.

The most popular time of the year when sales are held is Black Friday which is the day after Thanksgiving. If you can brave the crowds and you’d like to take advantage of huge price slash-offs, you should definitely consider hitting the stores on Black Friday.

Just make sure to do proper research beforehand. There are stores which advertise big discounts on their stores, when they are really just a few dollars off the regular price. You can visit websites like BlackFriday.org to know which merchants offer real deals for the items you’d like to buy.

You can also visit CyberMonday.com. The ‘Cyber Monday’ shopping tradition started in 2005 when online retailers started offering special discounts on their products. Held during the next Monday right after Black Friday, you can visit the website to see what online sellers have in store for you. This is a great way to shop if you are late in giving out holiday presents to your loved ones.

Use credit card rewards points

When you’re using your credit card throughout the year, you would have earned rewards points. Instead of claiming them during the odd months of the year, use them right before the holiday season. Low-cost credit cards offer rewards points, perks and bonuses for card holders which they can claim during the holiday season.

Aside from airline miles or cash back incentives, the points can actually be exchanged for real cash or merchant items so it’s something that you should ask your credit card company about.

Know when to use your card, and when to pay in cash

If you must use your credit card for your holiday shopping and you have several cards to choose from, always swipe the one with the lowest interest rate. Make sure that you will not overdo swiping that plastic card because you might just find yourself deep in debt at the start of the year, which is not a good place to be.

As mentioned earlier, it’s best to make a list and have a maximum amount of how much you can spend for gifts for each person. Think of credit cards as short-term loans so that you won’t get carried away with your holiday shopping.

Another good piece of advice to remember is this. If you have problems not using your credit cards for holiday shopping during the previous years, make it a point to enforce a cash-only-holiday shopping expedition. You can take out the money from your holiday shopping savings fund and spend it all.

After the money is gone, stop shopping. It sounds simple enough to do and with enough self-discipline, you can just as easily stick to your budget without going over.

Make use of coupons, rebates and discount vouchers

Online, there are many coupons and discount vouchers that you can use to somewhat lessen your holiday spending. Take full advantage of using the coupons and vouchers for items that you would be wrapping as holiday presents.

If you have a credit card, use your rebates or rewards points to the max. There are also rebates referral sites like eBates, where users can earn cash-back bonuses. You can use the points on gifts for other people or even yourself during the holiday season.

Think outside the box when looking for presents

Finally, think outside the box when looking for holiday presents. How about sending out holiday e-cards to your co-workers? This is a thoughtful holiday greeting for your acquaintances at work, to whom you may not really have a close relationship with. For the special people in your life, you can put together a gift basket with items based on their hobbies and likes.

You can also give out gift cards, coupons or vouchers. For those who love arts and crafts, do-it-yourself presents make for the perfect holiday gift. If you’re a photographer, you may want to offer your studio to friends and invite them over for a selfie party. You can distribute the pictures for free and tell them that it’s your holiday present.

When going holiday shopping, there is absolutely no reason why you should go over budget. By planning what you will buy in advance; taking advantage of sales, discount vouchers and rebates; and knowing where to shop, you can give out presents to your loved ones to spread the cheer during the holiday season. Now that you know how to save money for the holidays, all you have to do is give it a try!

About the author

Irina Vasilescu

Irina Vasilescu is our crafty designer. She joined the team three years ago and is also involved in the writing process.

5 Comments

  • Great article, but I don’t know how I feel about Holiday sales…at least not around my area. To me gift giving, be it in the Holidays or birthdays, is such a relaxing thing to do. But, no matter how relaxed I am others seem to be stressed and angry about buying a gift, especially when I visit Holiday sales. I won’t even go into some people’s attitude on Black Friday (which I think should be canceled,btw).

    This year I get to buy gifts that I know are going to be used so I am probably going to check out Cyber Monday because I’ve never done so before.

  • I have become a fan out loyalty points on cards for sure. I save money on my weekly shopping, as well as some other outlets.

    My credit card stopped doing points, which is a shame. Might be worth me swapping to one that does.

  • I do a lot of my holiday shopping right *after* the holiday! Seriously. The day after christmas is when all the wrapping paper and ribbons and ornaments a decor go on sale. If you wait a week, all of that will be 90% off.

    Same with thanksgiving. I’ve snatched up all of my fall-themed serving bowls and dinnerware at 90% off sale *after* turkey day.

    Give it a try!

  • This year I already have almost all my holiday presents for my kids. I used coupon and promotion codes to sign up for a variety of fun subscription boxes, most of which I only received the first box and then canceled. I also purchased some “mystery boxes” at a high discount through a subscription box company which guaranteed a specific value for the box. I have great presents that perhaps I wouldn’t have thought of buying, have presents set aside for some birthday gifts for friends of the kids, and have presents for my nephew ready to ship. Now I won’t be rushing around at the sales, at least not for the kids’ presents! Setting a specific budget works well for my husband and I as well.

  • I should have also included that I have tried to stop my compulsion to buy gifts for extended family and friends. Instead I make jam or fruit butters and bake muffins to give those people. One year I also made honey butter. I found that this saves me money, I have fun making the items with my children, and people seem to appreciate the handmade gifts more.

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