How To Set A Holiday Budget And Stick To It

For many, the holidays are the most wonderful time of the year. But for some, it's the most dreaded because of the added expenses that come with gift-giving. The holiday season in is always a challenge, but this year even more so due to inflation. Everything is much more expensive than it used to be, and many people are being forced to scale back their gift buying as a result. In other words, if you feel more stress than joy during the holidays because of financial pressure, you're not alone.

Luckily, there are ways to set a holiday budget and stick to it. Here are a few tips to ensure you enjoy all the holiday festivities without overspending.

Make a plan for the holiday spending

Create a plan for holiday spending, but make sure you account for all your expenses. Putting aside money for holiday gifts is a given, but the holidays mean spending more on decorations, food, and travel, which can add up quickly! NerdWallet recommends making categories for holiday spending. This way, you can decide how much you're willing or able to spend on things and set a hard limit. 

If you plan for holiday spending, you can avoid surprises! If you scramble every holiday to buy last-minute gifts for coworkers or neighbors, then set aside a day or two to bake cookies to give as gifts.

Save up for the holiday season

Start saving early for the added expenses of the holidays. The earlier you start putting money away, the more you can spread out your expenses over a longer period instead of incurring all the costs at once. There are simple ways to save money on everyday things, and you can make an annual goal to save for the holiday season.

You can even put your smartphone to work to help you save! Apps like Mint and Goodbudget give you a full picture of your financial situation in one place and can help you save for the holidays and other areas of your life.

Shop wisely for holiday gifts

Making a plan for holiday spending will help you shop wisely for holiday gifts. Take advantage of sales and coupons whenever possible, and resist impulse buying. Black Friday sales often start weeks ahead of Thanksgiving weekend, and you don't have to shop in crowded stores to save big bucks! Online shopping can offer even bigger savings. According to Forbes, Cyber Monday 2022 was the biggest shopping day ever, with American shoppers spending a whopping $11.3 billion.

Start your holiday gift shopping early so you have plenty of time to find bargains. The earlier you start shopping, you will likely find good deals on holiday gifts.

Keep holiday expectations in check to manage holiday spending

Keeping holiday expectations in check can help you manage your holiday budget and the temptation to overspend! While it might be tempting to try and create the "perfect" holiday, this is futile and unnecessary. Not only that, but it could land you in unnecessary debt if you feel pressure to buy things you can't afford. Not only will that take away the enjoyment of the holidays, but it will also leave you with lasting stress as you struggle to recoup the money you spent. 

Focus on enjoying the holidays more

It's important to remember that the holidays are all about spending quality time with those you love rather than showering them with expensive gifts. Financial stress over the holiday season can make us forget the reason for gift-giving.

Lifestyle guru Joanna Gaines has tips for gift-giving during the holiday season that we love. On the Magnolia blog, Joanna writes: "The names on a Christmas list are so much more than line items to be checked off. Those names represent the source of love in our lives and the people who have invested so much into us." Happy Holidays from our family to yours.