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Plan ahead to avoid a holiday spending hangover



Hard to believe, but the holiday season is right around the corner - a time of joy, family, friends, and lots and lots of gift-giving. While this spirit of generosity can lead to many fun exchanges with loved ones, it can also put quite a dent in your bank account. But by taking a few steps now to plan ahead for the holidays, you can enjoy this special time of year with no regrets come 2020.

Establish a gift budget
While there's no hard and fast rule on the exact percentage, some experts suggest setting aside 1.5% of your annual household income for holiday gifts. This does not mean you have to spend this much! But it is a good maximum limit to set for yourself to avoid going overboard. Once you have this number in mind, take some time to make a list of all your gift recipients and set an amount for each. Remember this total doesn't just include gifts for your loved ones, it should also take into account other related expenses, including:


  • Gifts or tips for service providers like mail carriers, hairstylists, teachers and more
  • Holiday cards and stamps
  • Wrapping paper
  • Shipping gifts to loved ones far away
  • Holiday charitable giving

Start saving
It's not too late to start setting aside a little savings each pay period now to help offset your holiday spending and avoid a massive credit card bill in January. Speaking of, while using a credit card effectively can have its benefits, do not pull all of your purchases on a credit card if you don't think you'll be able to pay it off at the due date. The interest will end up costing you more down the road.

Think outside the (gift) box
Think through your recipient list and try to come up with ideas for each person in advance instead of winging it at the mall on Black Friday. Not only will this save you time and stress as the holidays get closer, but it may also help you come up with some alternative ideas that cost less money but mean more to them. For example, instead  of buying your parents a new toaster, put together a day of fun activities together.

Shop smartly
Whether you shop online or brave the crowds at the stores this season, do some research to help you save money when buying your gifts. Find out who is having sales and when on the items you're planning to buy. Check out coupons or other promotions for possible discounts. By shopping around doing some homework, you could save money to put toward other gifts or back in your pocket. 

The holidays are a fun and wonderful time of the year, but it's definitely about more than the gifts. By planning ahead, you can ensure all you have to look forward to afterwards are the memories, not the bills!

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