5 Tips for Financially Surviving the Holidays
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November is here, which means Thanksgiving and the December holidays are right around the corner. If you’ve got kids like we do, it’s always an exciting time of the year. It’s also a dangerous 8 weeks for your bank account, especially if you’re just getting on track to begin with.
As you already know, this time of the year is filled with financial landmines. There are holiday gatherings, work events, and – of course – gift giving. Everywhere we turn, we’re bombarded with pressure to spend! Pressure from friends. Pressure from family. And even pressure from ourselves.
Sometimes, when the pressure gets to be too much, we cave. We toss our budgets out the window and vow to get back on track once January rolls around. Unfortunately, that attitude buries us under mountains of bills that can take months to correct.
But you can’t be a total Scrooge, right? You have some holiday “commitments” that need to be met. So, how can you deal with the holiday season without breaking the bank?
Fear not my frugal friends! Club Thrifty is here to help navigate the holiday spending minefield ahead. Hold on, buckle up, and check out these tips for surviving the holidays in the black.
Start a Budget… and Stick to It
Yep. The budget is back. Even the constant pressure of the holidays can’t contend with the power of utilizing a monthly budget. This simple tool helps you put presents under the tree while keeping money in your wallet.
Now, don’t just throw a number out there and plan your spending around that. Create a category for “holiday spending” on your monthly budget and plan for it like everything else.
Need extra money for your Thanksgiving meal? Write it in the budget. Saving money for gift giving? Stick it in the budget.
Every expense you have should be accounted for in your budget! And don’t forget: Your budget should balance to the penny. Then, promise yourself you’ll stick to the plan…and actually do it!
Track Your Spending
I’d love to say that the holidays are just like every other time during the year, but we all know they’re not. You’re almost certainly spending more than usual, which makes tracking your spending over the next few weeks even more important .
With all the events and gift giving, it’s easy to spend more than we intend. However, by keeping a close eye on what you’ve spent, you won’t lose track of where you are on your budget.
During the holiday season, comparing your expenses to your budget a few times a month might help you stay on track. You might even want to check-in a couple of times per week. That way, you can see exactly where you stand before and after you’ve done your spending. Using one of the best budgeting apps can be a great way to track your spending and survive the holidays with some cash still in your wallet.
Save the Cash
Thinking about putting your gifts on credit and paying them off later? If you remember nothing else, remember this: Don’t do it.
Seriously, don’t. Don’t do it, don’t do it, don’t do it… just DON’T.
Only make purchases you have planned for in your budget AND that you have the cash to buy. Charging gifts can lead to overspending and serious money problems down the road.
So, how do you buy what you need without going into debt? Easy. Save up the cash.
Although it may be too late this year, try starting a “holiday savings fund” next year. There is a simple trick called a “sinking fund” that can help.
Here’s a quick primer on how it works: Throughout the year, save a few extra bucks each month in an account specifically marked for holiday gift giving. Have it automatically deducted from your paycheck and deposited into this special account. The money will pile up all year long without any effort on your part and without you even noticing. When the holidays roll around, the money will be there when you need it.
If you still choose to use a credit card, at least use one of these great cash back credit cards to earn some cash back or points. Then, pay it off every time you make a purchase.
Seriously, go shopping; then, come home and pay it off. This helps keep your spending in check, keeps you out of debt, and ensures that you aren’t spending more than you realized.
Limit Gift Giving
Look, I love generosity. I think it’s extremely admirable. But, if you want to get ahead, you can’t give what you don’t have…and if you do, you’re setting yourself up for a world of financial pain.
If you don’t have the cash, consider giving fewer gifts this year. Cut down on both the number of gifts you give and the amount you spend, even when it comes to your children. They probably won’t even notice, and I promise that they’ll love the season all the same.
Stop giving to other adults – including your friends, siblings, and parents if needed. Tell them that money is tight this year. They’ll understand, and if they don’t – well – it’s not their money or their debt!
If this hurts, that’s good! Use that pain as motivation to get on track and do a better job of saving for next year.
Learn to Say “No”
When trying to get your money straight, one of the most important things you can do is learn to say “no.“
During the holidays, people invent all kinds of creative ways to spend both their money and yours! You’re expected to purchase loads of gifts, attend expensive events, and shell out big bucks in the name of having “holiday spirit.” Many of these holiday expectations are placed on us by friends and family, a opening the door to strained personal relationships if we somehow muster the courage to decline.
Sure, saying “no” this time of year can be exceptionally difficult, but you’ve gotta do it. Many of these worries are inventions in our own mind. Most people are too wrapped up in their own needs and schedules to even care. And again, if they do, it isn’t their money to spend or their financial mess to clean up.
If it isn’t in your budget, you must learn to say “no” so you can get ahead – even during the holidays. “No, I can’t participate in this gift exchange.” “No, I can’t use credit to buy gifts I can’t afford.” “No, I can’t buy a new dress for this event.”
Remember, most people are in debt up to their ears so why should they care about yours? Learn to say “no” so you’re not one of them any more.
Surviving the Holidays in the Black
How you handle the holiday season can prepare your finances for a whole year’s worth of success. By sticking to your budget and staying ahead of the game, you’ll start the new year with the positive bank balance most people only wish they had. While others are recovering from their holiday spending hangover, you’ll be primed to destroy your debt and continue moving toward a financially fit and happy life.
Yes, staying disciplined during the holidays isn’t always easy, but surviving the holidays in the black can give you the head start you need to crush it next year. You can do it! Just remember what you’re working toward, and don’t give in to the pressure of the holidays.
What are you doing to stay on budget this holiday season? Let us know in the comments!
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All great ideas Greg. We budget for the holidays like anything else so we can shop with confidence. Heck, we usually don’t spend what we budget for ourselves and the extra just goes towards vacation money for the family/529s for the kids. That being said, completely agreed on the cutting back if you can’t afford it. No gift is worth going/staying in debt for. I’d find other ways to give or simply spend time with someone instead so as to avoid spending the money you don’t have an start budgeting for next year.
Great ideas. Last year, my family actually decided to forgo giving any gifts to one another. We all live across the country so it because very difficult and expensive to not only give gifts, but to travel with them.
Honestly, we don’t miss it. Now that we are all older and independent, if we need something, we go buy it ourselves. It has taken so much stress off the holiday that we decided to do it again this year!
Great tips! I keep myself out of credit card debt by paying the cards off every other friday on payday. I’ve been doing this for years and have never once carried a balance.
I consider myself lucky because Mr. Frugal Turtle and I don’t usually exchange gifts and in my family we pick names, so that cuts down on the number of gifts I need. Way easier!
Great suggestions! We simplified our gifting a few years ago, saving us time, money and stress. I am actually using my cash back rewards to pay for gifts this year, but I don’t plan on spending much even with the rewards. We make many of our family’s gifts – not junky stuff, but nice, hand crafted items.
I’ll admit that I think the holidays are a time to be a little less strict with yourself in terms of money. Having a loose budget will definitely help though.
Saving up cash is the way to go! I did this for the first time last year, putting away 40 bucks a month (and still putting away $40 per month). By the time I got to the end of the year, I had almost $500 saved up for gifts, which really made the holiday season less stressful. The great thing was that I didn’t even notice I was saving money. $40 a month only adds up to about $10 per week, which is basically unnoticeable to me.
I agree having a budget, including for those extra’s like parties and events, is very helpful. I keep mind in a spreadsheet and I love opening up a year later and already having whom I bought for, what I bought, and what I spent all listed. It’s a great reference, helps set a specific budget amount, and speeds planning too.
Totally agree I tend to make a list of people I want to do gift then set a budget and start research plus I have a journal where I write what I bouhgt for who so I’m quiet sure to don’t buy same thing for the same person all tips are good:D
Sometimes gift giving can get out of control. I tell people they should start making calls/sending e-mails in October (but it’s not too late!) to start “cancelling Christmas” with friends and family if they really need to save money. Plus there’s nothing worse than starting off the new year with unnecessary debt. Great piece, Greg!
These are all great tips! The holidays are going to be expensive for us, mainly due to the cost of traveling back. We are currently driving our RV back \”home\” for the holidays, but that will cost over $1,000 just in fuel!
Sticking to my holiday budget is what can save me from this challenge. I have already done my list of gifts I need to buy and have categorized them accordingly. I have learned my lessons and I don’t want to deal with challenges brought by unmindful decisions on buying gifts for friends and family.
I’m about 80% done shopping already! 🙂
We are going to Disney the 1st week of December. That will be the main Christmas gift to my kids! LOL
I will manage to save a little to buy them some gifts that they can open on Christmas morning ‘from Santa’ but otherwise I have explained to them that Disney will be like a X-mas gift in itself. They seemed to understand and are ok with that. I mean Disney during Christmas time is the best. I’d forego gifts too!
Thanks for the great holiday shopping tips Greg! Personally, learning how to say no is a very hard task but one that hopefully this holiday season I will be better at! Sometimes you just have to say no because you can’t afford it and that is okay!
It’s unfortunate that sometimes the Christmas Spirit gets lost in ‘gift giving’, and, like you say, we put pressure on ourselves to buy gifts. We are going to budget a little better this year, we’ll see how that goes!