How much does it cost to make it merry? According to the National Retail Federation, American consumers spend around $1,000 on their respective winter holidays every year. It can be hard to strike a balance between holiday generosity and January regret; thankfully, mindful budgeting and careful spending can help you find the middle ground!
Here are a few of our holiday tips for enjoying the season without derailing your financial goals.
- Create a list of holiday expenses (i.e. travel, big family meals) and gift recipients. Set a budget for everything and everyone on the list and then do your best to stick to it.
- Armed with your list, try to avoid additional purchases by getting caught up in the excitement of “a good deal.” Also be mindful of the fact that many online “deals” are not really what they seem to be; often, retailers like Amazon hike their prices a month or two before the holiday rush so that they can drop their prices again and make normal prices look like a sale.
- Leverage your debt mindfully; credit cards can be a great convenience and a way to accrue useful points and rewards, but if you won’t be paying the balance right away the added interest can make an otherwise reasonable purchase much more expensive.
- On the topic of points, use your rewards and cash back if you can!
- If you are traveling, try traveling off-peak times. Pack snacks from the grocery store rather than eating out or picking up snacks at the airport or rest stops.
You don’t need to sacrifice your holiday cheer, but set guardrails for yourself to avoid overspending. If you can, save up (or even space out your purchases) throughout the year. This will help you start January bright and financially ready to take on the new year, rather than nursing the financial equivalent of a hangover.