It’s all too easy to overspend during the holiday season. Whether it’s Thanksgiving, Hanukkah, Christmas, or New Year’s, there are gifts, new clothes, and food and drink to factor into your holiday shopping list – which this year for many people is a cause for worry. Rising inflation and the energy crisis have put even more pressure on holiday budgets.

According to the National Retail Federation, U.S. consumers plan to spend around $950 on gifts, holiday items such as decorations and food, and additional “non-gift” purchases for themselves and their families this coming holiday season, which is $50 less than they planned to spend last year. Their spending will be inspired by friends, neighbors, and celebrities on social media.1

Despite the $50 dip, this retail forecast remains solid. Of course, everyone wants to enjoy the holiday season to the fullest, but you don’t want a January that includes worrying about your finances. Luckily, there are lots of ways to celebrate in style without breaking the bank. And this year, that’s more important than ever.

Here are eight tips for smarter holiday budgeting:

1.    Create a (realistic) budget

Don’t decide on an arbitrary number and make that your budget. Go back over what you spent last year and create a true-to-life picture of your expenses. Factor in any changes in lifestyle in the past year, such as getting married, buying a house, the birth of a new child – in addition to financial impacts like mortgage rate changes and food price hikes. Once you have a real view on what you will spend, you can start looking for places to curb your costs.

2.    Suggest doing Secret Santa with family, friends, and co-workers

Only having to buy one gift stretches your money further and eliminates a lot of the stress around holiday shopping. It’s especially good for large families, where you don’t want to buy for everyone but don’t want anyone to feel left out.

3.    Use your phone to save money

If you see that must-have item in a store or online, price-check it on your phone to see if it’s cheaper somewhere else. You can also use your phone and search engines to find promo codes for many retailers. A lot of stores also have price-match policies .

4.    Get creative

Homemade gifts and decorations are often the most cherished and appreciated. Many children love arts and crafts, so making decorations not only saves money, but creates festive memories for everyone.

5.    Don’t wait until the last minute

The early bird catches the worm, and this is especially true when it comes to holiday shopping. The longer you wait, the more retailers can increase prices. Make a November resolution to get all your shopping done early this year. Don’t forget Black Friday. Retailers push out discounts in the run-up to Thanksgiving; so, make a wish list and get ready to redeem any offers that land in your email inbox. It’s a great way to save and still buy the items on your (and Santa’s) gift list.

6.    Rotate hosting duties

Hosting can get expensive — food, beverages, party favors, and decorations. If you do Christmas Eve, let someone else take on New Year’s Eve. This works especially well for family gatherings. If you are hosting, be sure to buy items like wine, canapes, chips, and dip in bulk.

7.    Cut or freeze other expenses for the duration of the holiday season

In addition to pausing all non-essential non-holiday spending during this time, see if you can consolidate any expenses. For example, make one family Spotify account. Look to do the same with other expenditures, such as meal plans and kids’ activities.

8.    Remember we’re all in the same boat

Everyone overspends on the holidays. There’s a good chance that if you suggest a way to save money, others will be delighted. This includes setting limits on what you spend on gifts for each other or encouraging everyone in the family to make a dessert or side dish.  

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Media contact
Kevin Maher
New York Life Insurance Company
(212) 576-6955
Kevin_B_Maher@newyorklife.com

Related content

1) https://nrf.com/media-center/press-releases/nrf-forecasts-holiday-sales-will-grow-between-38-and-42-percent