Why is it so easy to overspend for the holidays? That’s a question many of us ask ourselves at this time of year – and it’s a tough one to answer. It may be because of the relentless holiday advertising, or it may just be that generosity sometimes gets in the way of common sense.
Whatever the reason, it’s important to find a balance between buying gifts for everyone on your list and putting yourself in debt. At Addition Financial, we understand – and we’re here to help. Here’s what we suggest for Christmas shopping on a budget.
Set a Realistic Spending Limit
The first step is to take a deep breath, step back and decide how much you can afford to spend this holiday season. That may mean:
Evaluating your monthly budget and seeing how much discretionary income you have
Checking the balance in your holiday savings account
Making a list of the people you feel you must buy gifts for
It’s important to set a spending limit early – before anybody else comes to you and suggests a gift exchange limit. Nobody else can tell you what you can afford and having a clear limit will help you navigate the ins and outs of buying Christmas gifts on a budget.
Make a List
Santa Claus isn’t the only one who needs to make a list and check it twice. Once you’ve got a handle on your total spending limit, the next step is to make a list of the people you’ll exchange gifts with this year.
Remember that you don’t need to give a gift to everyone who gives you one. You’re within your rights to limit the number of gifts you buy. We recommend listing everyone you want to buy for and then looking for ways to fit those gifts within your budget.
Look for Ways to Save
When you feel you need to buy a gift for everyone in your family (or every friend, or every coworker) then it’s easy to go overboard with holiday spending. Here are some pointers to help you minimize your spending and stick to your budget.
Set spending limits within groups. For example, if you always exchange gifts with your sorority sisters, you might suggest sticking to a $10 or $20 spending cap to keep your expenses under control.
Do a gift draw where each member of a group buys a gift for one other person. Websites such as Elfster can help you manage a Secret Santa exchange for a large group and set spending limits.
Agree to a White Elephant exchange where you all buy joke gifts for one another. This is a good way to keep expenses to a minimum because the goal is to have fun, not to impress someone with how much you spent.
For these suggestions to work, everybody in the group must agree to adhere to the rules and limitations you set out.
Give the Gift of Thoughtfulness
It might be a cliche to say, “It’s the thought that counts,” but with holiday gift giving, the cliche is true. The point of giving a gift at the holidays is to show people that you care about them – and there’s no better way to do that than to choose a gift that’s perfectly suited to their tastes.
The best part about this tip is that it can be adapted to a variety of gift-giving strategies. For example, you could:
Learn about people’s hobbies and give them related gifts
Give someone who misses you the gift of your time
Make homemade gifts that you tailor to each person’s preferences
It doesn’t take much more time to choose a thoughtful gift than a generic one – and the thought you put into each gift will make them feel expensive even if they’re not.
Buy in Bulk
If you’ve got a large group to give gifts to – for example, if your company culture involves everybody exchanging gifts – then you may want to consider buying in bulk as a way of saving money.
Here’s an example. You could make a Costco run and buy some fun food and holiday items at discounted prices. Then, you can take the items and separate them into gift bags or baskets to give to your coworkers. The items you buy will be more affordable in bulk than they would be individually and you’ll be able to give some impressive-looking gifts!
The most important thing to do if you want to buy Christmas gifts on a budget is to be creative. Ultimately, Christmas gifts are meant to show people that you care – and you can’t set a price on that.
Need some help saving for the holidays? Click here to learn about Addition Financial’s holiday savings accounts!