Smart ways to rein in holiday spending
Prepare a budget for your holiday expenses and you're less likely to go overboard, experts say. Credit: AP/Bebeto Matthews
The holidays are a huge deal in the Weston household — and every year, the expenses threatened to gallop out of control.
Keeping the holiday joyous and less stressful means keeping a firm rein on our spending. Here's what we do, as well as smart frugal tips from others:
Budget for every expense
By early November I set up a spreadsheet with budgeted amounts for:
- Gifts, with names and how much we expect to spend on each person.
- Holiday tips, again with names and amounts.
- Travel expenses, including gas, hotel and meals.
- The tree, lights and other decorations.
- Food, drinks and treats for holiday gatherings.
- Holiday cards, postage and wrapping supplies.
Spreadsheets aren't exactly warm, fuzzy and cinnamon-scented. But they allow us to see our total expected holiday spending and to make adjustments as necessary.
We've used various ideas over the years to curb expenses, as our fortunes and the size of family gatherings have changed. One year the adults drew names for gifts. We've also asked friends and more distant relatives to exchange cards instead of presents. We set an overall budget for our daughter's presents, then have her prioritize her wish list. Learning to prioritize is an important life skill.
Check the 'cushions'
Remember the days when you ransacked the couch cushions for loose change? There are better places to hunt for forgotten money. Some places to look:
YOUR GIFT CARD STASH. Pass them along, use them to buy presents or cash them in at sites such as Gift Card Granny or Raise.
CREDIT CARD REWARDS. Rewards points can be used to buy gift cards and merchandise. We typically use our rewards for travel, but I sometimes turn points from little-used or orphaned accounts into gift cards.
THE COIN JAR. Some banks and credit unions will count change for free, or you can use the CoinStar machines found at many groceries and drugstores. We avoid CoinStar's exchange fee by opting for electronic gift cards from Amazon, Starbucks and other retailers.
THE GIFT STASH. Surely I'm not the only person to tuck away the perfect gift for someone, only to find it years later. Now I keep a bin in the closet to stash presents year-round.
THE HEIRLOOMS. Consider passing along a treasured object while you're still around to enjoy the recipients' pleasure. It could be something you inherited or that the other person admired: a piece of artwork or jewelry, a beloved toy, a musical instrument, a grandparent's toolbox or baking supplies.
Prep for next year
At the end of the season, I have a realistic idea of how much to save for next year. I divide that total by 12, and set up a monthly transfer to an online savings account labeled "Christmas." Having the money to pay for the holidays in cash every year may be the best gift of all.
Our holiday spending surge requires cutting other expenses to keep our budget in balance. Ahead of the holidays, we:
- Eat out less and plan meals that mostly use items from our pantry.
- Scour our recurring bills for possible savings, such as pausing subscriptions or canceling an unused gym membership.
- Look for cheap entertainment, such as free community concerts or baking cookies with friends.
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