It’s the most wonderful (and expensive) time of the year
The presents. The travel. The food. The parties. The holiday season is fun — but not so fun for your wallet. Don’t worry, you don’t have to turn into Mr. Scrooge and avoid the festivities. The U.S. News My Money bloggers have a few tricks to get you through the holidays without suffering a major debt hangover come News Year’s Day.
Prepare a spending plan.
A gift list is helpful for planning your holiday spending, but it doesn’t account for food, decorations and entertainment. That’s why WiseBread contributor Sabah Karimi advises to create a “spending plan” that includes all holiday expenses. “If you aren’t keeping track of every single purchase, you’ll overspend more quickly than you can say ‘Happy Holidays!'” adds Dough Roller contributor Abby Hayes. She recommends using an online budgeting tool like Mint or the old-school spreadsheet method.
Set up a separate savings account.
It’s easier to save for your holiday budget if you have a separate savings account. Karimi suggests setting up a second savings account with your bank or seeing if your online banking features allow you to start a sub-savings account for holiday purchases. “Creating a separate account that allows you to automate savings contributions can also make it easier to meet a savings target,” she explains.
Put a hold on luxury spending the rest of the year.
Do you really need those new shoes? Do you have to go to that concert? Is your daily Starbucks run necessary? Karimi recommends looking at the discretionary expenses in your budget and shifting those funds to a “holiday” category. “If you can cut out some of those costs on entertainment, dining out and other extras for just a couple weeks or months, you may be able to save a few hundred dollars just in time for the holidays,” she writes.
Check your credit card perks.
Before starting your holiday shopping, look at your credit card agreement to see if it comes with price protection. As Credit Karma’s Jenna Lee points out, it’s frustrating when you buy a gift and then find it in another store with a cheaper price tag. “Luckily, many cards offer price protection, which typically means your credit card provider may cover the price difference if you see an item you purchased at a lower price and file a claim within a certain amount of time,” she explains.
Don’t forget to look at your travel perks.
Some credit cards offer trip cancellation insurance. “Emergencies happen,” Lee points out. “If you suddenly get sick or there is a death in the family, and you booked your flights using a credit card, you may be able to get your money back on those nonrefundable tickets.” Also check if your credit card comes with rental car insurance perks. There’s no need to purchase a damage waiver if your card issuer offers car collision and theft protection.
Be strategic about booking flights.
Flying home for the holidays? Try booking a flight on a Tuesday, Wednesday or Saturday. According to FareCompare.com, those are the cheapest days to fly in the U.S. Also look for flights on Sunday, as a recent Airlines Reporting Corporation survey found the cheapest tickets are listed that day. Club Thrifty founder Holly Johnson offers one more tip: Consider flying early morning or late at night. “Most people don’t want to fly at the crack of dawn or past their bedtime,” she writes. “Because of this, early and late flights are typically far cheaper than flights during normal business hours.”
Leverage holiday credit card rewards.
Many credit card companies offer special rewards during the holiday season. For example, American Express cardholders can receive a $10 credit when they spend $10 or more at an eligible business during Small Business Saturday on Nov. 29. If you need help keeping track of all your credit card offers, Hayes recommends downloading the Wallaby app. You just enter your credit card information, and the app shows your available rewards.
Host holiday potlucks.
Your grocery bill can add up quickly when you’re hosting a holiday dinner. Keep food costs low by planning a potluck and asking friends or family to bring the side dishes, desserts and drinks. If you’re hosting Thanksgiving, Mint.com spokeswoman Hitha Prabhakar advises to do some turkey price-comparison shopping: “Opt for a grocery store turkey, which will cost about $2 a pound, and for an even better deal, visit your grocery store early and store the turkey in your freezer.”
Get thrifty and borrow decorations.
You can make your home look like a Crate & Barrel photo shoot without paying Crate & Barrel prices. “Shop for serving items, platters and vases at thrift stores where you can often find good deals for less than $5 each,” Prabhakar suggests. “Better yet, borrow what you don’t have. If you have to buy something new, try to invest in items that can be used again to reduce costs for future parties.”
Organize a gift exchange.
It’s easy to overspend during the holidays when you buy something for everyone you know. “But buying for everyone spreads your resources thin and your credit card debt thick,” Hayes writes. Instead, arrange a gift exchange with family, friends or co-workers. Have everyone draw a name out of a hat, and buy a gift just for that person. “This allows for more thoughtful gift- giving and reduces the total amount you spend on gifts,” Hayes adds.
Shop online first.
Before hitting the mall, scope out online stores to look at prices and see if an online purchase might save you time and money. “You could be eligible for free shipping, find online-only discounts and save money on gas to get to and from the store,” Karimi writes.
Follow your favorite retailers on Facebook and Twitter.
Many stores post discounts and sales exclusively for their followers on social media. So it’s a good idea to create a Twitter list just for retailers and follow them on Facebook for potential savings. “If you take this route, though, have a budget ready to spend when the sale is on,” Hayes warns. “Often, these sales will last for only 24 hours or a little more.”
Watch out for ‘unbeatable sales.’
The flashy red sale signs everywhere this season can be hard to resist. But Karimi recommends putting items on hold and taking 24 hours to think through a purchase. “Many last-minute deals and clearance events are designed to prompt a quick buy, which may not be your most informed purchase,” she points out. So do some comparison-shopping before whipping out your wallet. As Karimi says, “make sure that sale really is a sale.”
Start a side gig to earn extra cash.
If you’re feeling strapped for cash, Hayes shares a few holiday service ideas to pad your bank account:
— Holiday shopping. Busy parents don’t always have time for holiday shopping. Start a service to shop and run errands for them.
— Holiday cleaning. Offer a “holiday deep clean” for people who want their homes to look spic-and-span for festivities.
— Holiday organization. Help clients tidy their homes before the influx of gifts arrive or market your service around Jan. 1 for people with New Year’s resolutions to “get organized.”
— Holiday baby-sitting. Capitalize on the season of parties by offering baby-sitting. Get more bang for your buck by watching kids from several families at a time.
Shop and wrap gifts early.
It might be easier said than done, but set a goal to finish shopping at least two weeks before the holidays. Hayes suggests wrapping all your gifts so you won’t be tempted to add “little extras” later on. “Yes, this is a tall order,” she admits. “But shopping earlier and more thoughtfully keeps your spending under control and makes the holiday season more relaxing and enjoyable for everyone.”
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15 Ways to Avoid Holiday Debt originally appeared on usnews.com
