How Not to Overspend on Christmas Gifts
If you’re feeling the pressure to overspend this holiday season, you’re not alone. Nearly half (45 percent) of Americans say they’ve felt they had to spend more money on holiday gifts than what they’re comfortable with, a new survey from Bankrate found.
Those who feel most pressured to overdo it are parents, women, and millennials, the study found. However, parents and women are more likely to use coupons and shop around to save money, while millennials are more apt to give homemade gifts.
If the holidays are making you feel more maxed out than merry, try these five tips for keeping your holiday spending under wraps.
Suggest a Secret Santa
As your family grows, so you can your gift list. If you find yourself buying ten or more gifts for everyone from your parents to your siblings to your Great Aunt Sue, then maybe it’s time to simplify gift buying during the holidays.
This is where Secret Santa comes in. Family members swap names and buy only for that person. Gifts should be within a spending limit, for example, $40-$50 per person. You can do a themed exchange like a White Elephant or wine exchange, or simply play it straight and just get something you know the recipient will love. Then on the big day, reveal yourself on the gift's tag and revel in your gift-buying expertise.
Secret Santas are a solid money-saving option during the holidays because they ensure that everyone has something nice to open on Christmas, but everyone won't bust their budgets in the process.
Shop Sales and Plan Ahead
Take advantage of major sale days like Black Friday. You’ll get a jump on your holiday shopping and save big in the process. It’s a win-win. This year, I did 90 percent of my Christmas shopping on Black Friday. Not only was I able to get quality gifts at a massive discount, I also knocked out most of my list early. (Sadly, my family does not yet subscribe to the Secret Santa gift-buying strategy.)
But don’t use sales as an excuse to overbuy or make impulse purchases.
Another pro tip? Don’t buy for yourself, too. That’s a surefire way to bust your holiday budget.
Stick to a Gift Budget
Speaking of budgets, make one. We all know that sticking to a monthly budget is key to maintaining a solid financial foundation. The same principle applies to holiday shopping.
Before the holiday shopping frenzy begins, makes a list of everyone you need to buy for, from your child’s teachers and your landscapers to your relatives. Be sure to include your spouse and children. Then decide how much you’ll spend on each person. I usually do it on a sliding scale: $20 for teachers and similar recipients; $40-$75 for relatives; and $200 each on spouses and children. But that’s just a ballpark number. Be sure to set reasonable spending limits based on what you can afford right now – not what you can afford to pay off in January.
On that note, avoid buying gifts on credit cards. You'll end up paying much more than the sticker price in interest, plus you’ll be tempted to overspend. No one wants to be stuck with a big credit card bill in 2019 just because they got a little too gung-ho-ho-ho last Christmas.
Skip Gifts Altogether or Gift Experiences
In the age of Marie Kondo and Swedish Death Cleaning, the last thing many of us want is more stuff. This year, consider skipping gift-buying altogether. Instead, give experiences.
From concert tickets for your parents to a paint chips, a roller and some paint brushes – along with a promise of a full day of painting fun – to your aunt, the options are endless. And sometimes, the promise of an outing and quality time spent together is worth so much more than a pretty gift under the tree.
- 31 million Americans are willing to boycott gifts altogether this year.
- 22 percent Americans are willing to re-gift this year.
- Women are 62 percent more likely to use coupons when holiday shopping.
- 18 percent of parents are willing to purchase second hand gifts for their children this holiday season.
- Americans earning more than $75,000/year are more likely to than those earning less than $30,000/year to shop around for sales and use coupons to buy holiday gifts.