How to Start Budgeting for the Holiday Season Right Now
The average American enters the new year with just over $1,000 in debt from the holiday season. Add this holiday overspend to your regular bills, and it might take several months or longer to get back on track financially.
You don't need to turn into Scrooge to avoid this holiday-debt black hole, if you start prepping for your holiday spending in advance. Here are budgeting tips and tricks to help you get ready now:
Create a Holiday Budget
Figure out how much you want to spend to avoid post-holiday regrets. The amount is up to you, but remember to allocate funds for holiday dinners and entertaining, home decor, activities and clothing, as well as gifts.
Setting your holiday budget now also allows you to start setting money aside. If your budget is $1,000, and there are ten weeks until the holiday season, you can put aside $100 extra each week. Saving an additional $100 per week could be as easy as skipping a restaurant meal, buying fewer new clothes or shoes and sticking to your grocery list.
Divvy Up Your Budget, Shop Smarter
Once you have a total gift budget, divide that budget by the number of people on your shopping list. For example, if you have allocated $500 for gifts and have 20 people on your list, then you need to decide if each person receives a $25 gift or if you will vary the amounts for family and friends.
You can shop smarter by taking advantage of sale items; new or open box items discounted on eBay and Amazon; like-new items on local community shopping apps; cash back sites and redeeming discounted gift cards.
Know When to Cut Back
If money is tight this year, don't be afraid to decline invitations for optional events. Withdrawing from a holiday party or gift exchange can save you up to $100 on food, a new outfit, and a gift. You can also send out a family photo and handwritten note over a professionally made holiday card to save $2 to $3 per card.
Another way to save is to propose that extended family members or friends do a gift exchange instead of buying individual gifts, or to set your own terms for gift-giving. For example, you could let those on your list know that you're giving books this year, and ask them for a title or category suggestions. Being open about your intentions helps lower overall expectations and also lets others know how much to budget for you and your family.
Find Ways to Earn Extra Money
Use the months before the holiday chaos to sell items you no longer use. If it's too cold to have a garage sale, try listing your unwanted things on eBay or through selling apps like OfferUp and Letgo. To maximize your profit, sell like items in lots, such as kid books that are at the same reading level or toys that would appeal to the same age or age range.
The holidays are also a great time to earn additional funds through a seasonal job or gig that can easily fit into your regular work schedule — retail hours, babysitting, gift wrapping, errand running, house cleaning, or hanging Christmas lights - are just some of the possibilities.
By adopting some of these holiday budgeting and spending tips, you can hopefully worry less about your finances and focus more on enjoying the season.
Community Questions: What are some ways you prepare for the holidays early to save money? What are some things you are saying no to this holiday season to save money?
All content provided in this blog is supplied by Ashley Eneriz and is for informational purposes only. Barclays takes no position as to the views, and makes no representations as to the accuracy or completeness of any information contained in the blog or found by following any link within this blog.
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