The holidays are just around the corner and that means it’s time to start budgeting for the festivities, as well as everything that comes along with them. With the cost of travelling, hosting parties and finding the perfect gifts for everyone on your list, the cost of the holidays can quickly add up.
Many people get through the holidays by using credit cards then spend the first part of the new year paying off debt. The financial stress of the holidays can be avoided with a little bit of planning and a dash of budgeting. These two things can help you survive the holidays financially and have a merry old time.
Here are five ways to budget for holiday gift giving:
Make a list and check it twice
During this time of the year there is a lot of pressure to find the perfect gift for everyone on your list. However, getting wrapped up in the spirit of gift-giving can wreak havoc on your budget. One way to save money during the holidays is to cut your list down and only buy gifts for those who made the short list. Sometimes it’s the gesture that counts and a greeting card can go a long way.
Suggest non traditional gift giving
Instead of buying gifts for everyone you know, drawing names is an economical alternative. This still allows you to get together with family and friends and it keeps your budget intact. The same rule applies to hosting a holiday meal. Instead of one person buying and cooking all the food, suggest a pot luck and ask guests to share preparation and costs.
Start saving sooner rather than later
The holidays come at the same time every year, yet very seldom do people start planning for the cost in advance. Starting to save at the beginning of the year by putting a little money aside every month can help avoid putting you into debt during the gift giving season.
Saving and paying for all your holiday gifts with cash also ensures you stick to a budget because you save what you need and you can’t spend more cash than you have. Consider a cash budget for your holiday shopping this year.
Set spending limits
This is easier said than done, but if you want to avoid ending up in the red after the holidays it must be done. The spirit of gift-giving can be overwhelming, but we can’t let it get the best of us. It’s nice to want to buy gifts for everyone on your long list, but can you really afford it?
Set an overall spending limit as well as individual gift limits to make sure you only spend what you can afford. It’s also a good idea to track your spending to ensure you stay on budget.
Take advantage of a good sale
If you have several people on your list to buy gifts for, why not save yourself some time and money by taking advantage of a good sale. If you find the perfect gift at a great price don’t be afraid to buy it for more than one person on your list. As long as they aren’t opening them in the same room at the same time there’s no reason you can’t wrap the gift and give it twice.