Tips for staying within your Christmas budget
Each year, there are two seasons where I see a dwindling of interest in being frugal: the Summer months and the weeks between Thanksgiving and January 1st. According to retail sales figures so far, consumer spending this holiday season is at an all-time high while true jobless numbers are quite depressing.
I've worked with families who have worked so hard throughout the year to stay on track financially. Christmas season starts and all their work to stay out of debt and stay ahead of their bills becomes unraveled. Please review these tips to avoid some costly choices simply for the sake of “celebrating the season.”
Don't use credit cards unless you have the cash to immediately pay the balance.
It's true that Christmas, by itself, can be a big expense. The National Retail Federation estimates the average holiday shopper will spend $749.51 on gifts, decor, greeting cards and more. The reality is that most of that $749 will be put on credit cards. In December of 2011, 14.1 million Americans reported that they were still paying off debts from the previous Christmas. If only minimum payments were made on that credit card balance, it would take seven years to pay off and an additional $600 in interest.
Ideally, a budget-savvy family would have been saving a small amount each month to pay for Christmas presents and related expenses. If this isn't your reality for Christmas, please stay extremely conservative with your expenses and start planning for Christmas in January. This may take some painful discipline – and it may be too late if you've already completed most of your shopping. Mathematically, however, one frugal Christmas can save you thousands of dollars over a lifetime, however, if you'll pay in advance rather than pay off your Christmas celebrations. You will also likely have more cash to work with each year.
Make sure you do not shop impulsively at the grocery store!
Sadly, I have seen shoppers throw their grocery budget out the window during December “because it's the holidays.” This can easily mean an extra $200-$400 LOST because of the desire to shrug off financial commitments. Families can struggle financially throughout winter because of the desire for a month of supermarket shopping “freedom.” Please resist the urge to let your guard down.
SavingsAngel.com and your Sunday coupons are a perfect way to add hundreds of dollars INTO your Christmas budget. We've been offering personal advice throughout the last part of the year to anyone who wants to free up extra money for Christmas from their grocery budget. With the right planning, you can enjoy great gifts, great food throughout the holidays, and plenty of money left over by the end of it all.
If you still have shopping left to do, these four tips may help:
You may already have gifts to give.
As you check through your Christmas supplies, look through boxes for potential gifts, perhaps items that you received or didn't give from last year. If you've been following my advice throughout the year, you likely have gotten many products for free that you may not immediately need. Shampoos, body wash, makeup items, health and beauty supplies are among the products that make for great gift baskets.
Shop from a list and plan your purchases at home.
Just like families who save more money on groceries by planning ahead and researching the best prices and discounts from their computer, you should do the very same with Christmas gifts. Don't simply trust that your favorite supercenter will have the best prices for Christmas.
Savvy shoppers don't mind taking an extra couple minutes to call local retailers or review their ads online after reviewing Internet retailer prices. Avoid milling around aisle after aisle looking for gift ideas. You're likely to be much more efficient online and you'll likely get a better deal.
Give gifts from the heart or gifts of your time.
Don't underestimate the value of your time and service. If you're a busy mom or dad, you'll realize just how valuable a prepared meal, getting an hour of help around the house, babysitting, or some help in the yard or with snow removal would be. It's a gift certificate I would display proudly on my refrigerator until I could redeem it. You might just find that gifts of service may be more memorable and appreciated than something off the shelf. With enough gifts of service given, you could potentially save yourself a hundred dollars or more.
Do your Christmas shopping AFTER Christmas.
With all the hoopla over Black Friday, Cyber Monday, and the sort, the best deals (except for the first ten shoppers who may have hit your local Best Buy) will come in the days following Christmas.
To leverage this, you might consider buying gift cards. This may or may not be a good idea depending on who you are buying the gift card for. Are they a procrastinator? Might they misplace the gift card? Consumer groups estimate that ten percent of gift cards are never redeemed.
Additionally, while store-issued gift cards are straightforward, bank-issued gift cards (e.g. an American Express gift card) can contain restrictions and fees that end up costing your gift recipient money if not redeemed in time. If you do buy gift cards, make it a point to touch base with your gift card recipient to see how their purchase went or offer to take them shopping on a scheduled day.