How much of the projected $910 billion to be spent online this holiday season will be by you? Between Amazon and your favorite stores, it’s so easy to shop from the comfort of your couch (or bed, let’s admit it).
Whether you forgot to plan ahead and missed the Black Friday deals, or you have parents, kids, cousins, friends, co-workers, neighbors, and even pets to shop for, the chances of you spending more than you would like to are pretty high.
Here are some tips to not only create a budget but stick to it this holiday season:
Understand your love language
One of the best ways to learn your tendencies when it comes to giving and receiving gifts is to understand your love language. If you haven’t already, I highly recommend reading Gary Chapman’s book “The Five Love Languages“!
If you don’t want to read the book, you can take the quiz to quickly learn your preferred way to express and receive love. According to Chapman, the five love languages are words of affirmation, quality time, receiving gifts, acts of service, and physical touch. While you might show love one way, others may have different ways they prefer to receive love. Taking some time to reflect on this before clicking “purchase” will help ensure your thoughtful gift is well received.
Set an overall holiday budget
I know, I know. I said the dreaded word that shall not be used, BUDGET. Rather than thinking of a budget as negative or restrictive, you should think of it as a target you are aiming for. Without a target, you are likely to overspend, which could potentially hurt your other goals (like saving for a car or taking a vacation).
It’s also important that you set a realistic budget. Will spending $100+ on each of your friends’ gifts affect your ability to pay your bills next month? While Christmas is a time to think about others, you should prioritize thinking about what can you actually afford. Whether you are comfortable with spending $100 or $1,000 this holiday season, creating a target will help you avoid overspending.
Set a budget per person
One of the hurdles you will encounter when setting a budget is, the more you spend on one person, the less you will have available to spend on another. If you overspend on your coworkers, you may not be able to buy your partner the gift they want.
After setting an overall budget, consider setting targets for each group (i.e., family, friends, coworkers). You might set a $25 limit for coworkers, $50 for friends, $100 for family, and more for your partner. These are only targets, so it’s okay to spend a little more on your favorite coworker or less on your sibling.
Use discount codes
I hate having my email inbox full of “junk” as much as the next person, but sometimes the promotional emails you receive can save you a lot of money around the holidays. Many stores will also provide you with a promo code for just signing up for their email mailing list. Pro tip: you can unsubscribe literally right after using the promo code!
There are several resources available to find promo codes online. One of them is the honey chrome extension. Once you reach the checkout screen for an online store, the honey extension will apply different promo codes to try and save you money. While the promo codes are usually hit or miss, it’s worth trying to find available discounts!
Avoid opening new credit cards
You know exactly what I’m talking about. “Sign up for a store credit card today and receive 35% off your order”. Sounds like a great deal right? Not so fast.
Think long-term. Every time you open a new credit card, this affects your credit score. If you open multiple lines of credit or credit cards at once, your credit score will likely decrease. If you are saving for a home or car, this can affect the interest rate or amount of loan you will qualify for. Plus, you are more likely to shop and spend more money if you have a store credit card.
Have an accountability partner
Whether it’s fitness, health, or financially related, it’s a good idea to have a partner to keep you accountable. Studies have shown that sharing your goals with someone else has an increased likelihood of achieving them.
Consider sharing your spending targets with your partner, close friend, or financial planner. Not only will they keep you accountable, but they can provide you with support if you are struggling. Remember: no budget is perfect, plans will change, and life will happen. And that’s okay!
Having a budget during the holidays can seem impossible, but with the right tools and support system, you can take control of your finances. If you would like to work with a financial planner to walk you through your options, I would love to help you!
To learn more about becoming a client, schedule a complimentary meeting now!
Disclaimer: This blog is for informational purposes only, and should not be considered advice or recommendations. All opinions expressed herein are solely those of Amaral Financial Planning, LLC, unless otherwise specifically cited. Material presented is believed to be from reliable sources and no representations are made to another parties’ informational accuracy or completeness. You should consult your financial advisor, tax professional or legal counsel prior to implementation.