Tips to Help Manage Your Holiday Spending

The holidays are a wonderful time, but if you are not careful, you could also end up with a season full of financial stress. The best way around this is to make and stick to a budget plan.This won’t only help you reduce stress, but it will also save you from overspending. Learn how to begin planning for the holidays while minimizing the financial impact.

 

Begin with a list of holiday expenses

Decide how much you can afford to spend responsibly before the holiday season begins, and then divide that amount into a budget. A budget is an estimation of your money, and if you write it down you are 1.5 times more likely to achieve it. So make a note of all of your expected holiday spending. In addition to gifts for friends and family, consider holiday clothing, travel expenses, shopping, decorations, donating to charitable causes, food and drinks for parties, holiday concerts and movies, gift exchanges at work, greeting cards, family photos and anything else. This will give you a general idea of what you will need to pay for. Once your budget is made, you can start planning your holiday.

 

Decide on Your Spending Limit

Now that you know where your money is going, it is critical to examine your budget and determine how much money you have for your holiday spending. Also if you tend to overspend on your credit cards or debit cards, it is good to pay everything in cash for holiday shopping. Give yourself your full budget in cash to become more mindful of your spending habits. 

Use cashback credit card

As you plan your holiday shopping, consider having the right credit card in your wallet to maximize each purchase. One easy way is to use a cash back credit card that earns a flat rate on every purchase. With this type of card, you can earn anywhere from 1.5% to 2% cashback on every purchase, adding value not only during the holidays but also on your regular everyday spending too. And if used efficiently, earning a little cashback on your spending can add up over time to help you earn big savings throughout the holiday shopping season.

 

Track your expenses

Putting your budget on paper does not imply your work is done. You must still keep track of your expenses as you shop to ensure that you remain within your budget. Take your gift list and budget sheet along with you on every shopping trip. Furthermore, keep track of your holiday-related outings and other expenditures as it can easily get out of control if you aren’t paying attention to the total amount you’re spending. 

 

Shop smart

If you can't narrow down your gift list, stretch your budget a little by shopping strategically.  Use price-comparison apps such as ShopSavvy to ensure you are getting a good deal on everything you buy. Think about doing most of your holiday shopping online during sales. Aside from the convenience, it is simpler to compare costs. Also don't forget to use discount codes to save money.

 

When your holidays are over, recheck your budget and see how well you managed to stick to it. If you did stay within your limits, congratulations because you’ve just figured out what works for you. However, if you went over budget in certain categories, it's an indication that you need to adjust your budget for next year, allocating extra money to those specific categories. Hence set your expectations and budget, but don't go overboard. 

For more tips, check out our other articles. BanqMart is always here to help you make the best financial decisions.