You might think it is still too early to start thinking about your holiday budget but the year is almost over. We are at the last third of the year and one month out from the last quarter of the year. In fact, Christmas holiday countdown is already down to two digits. This simply means that people will again be in the mood for spending and businesses will be all too happy to accommodate this desire to spend.
A lot of people end every year in debt because of holiday shopping. One reason for this is that the happier people around you are during the holidays, the more it feels like Christmas. This can make you spend more than what you have planned. It also does not help that different stores will be putting out promos in time for the holidays. Here are a few things to keep in mind to help you put together a budget for the coming holidays. These are helpful especially as NYPost shares how many Americans lack an understanding of even simple financial terms. This can make it all the more difficult to put together a budget.
Take a look at your spending last year
Creating a holiday budget starts by learning from what your experience in the past. The way to move forward is to look at the past. Try to look up you budget for last year’s holiday season. More than hoping to benchmark to save the same amount as last year, look at how you fared as well. Were you able to stay within budget, spend less, or did you go over your limit?
Taking a look at how you performed the last time around can help you manage your expectations for this year. If you went overboard, it would be a good idea to take a look at the reasons why that happened. On the other hand, spending within your budget last year boosts your confidence in doing the same this time around.
Create a new holiday budget
Now that you have unearthed you last year’s budget, you can use it as a take-off point for this year’s budget. It can make your budgeting efforts a little easier because you have a list to work on. You do not have to start from scratch and list down names of people you want to buy and send gifts for. Having a previous list on-hand can be a big time saver and you can simply add or take out names from it.
This also means that whatever holiday list you create for this year, you better make sure that you can still access it next year. It would be ill-advised to throw away your list because you would have to wait another whole year to use it. However, it does not have to be that way. You can expand that list by putting birthdates of people close to you so you can use it all year round. Another idea is to have a digital copy of the list so you do not lose it and simply access it again whenever you need to.
Be on alert for discounts and promo offers
Now that your holiday budget is starting to shape up, you should have a pretty good idea what items you will be purchasing as gifts. This is important because you can start hunting down bargains and discounts for the specific items you plan to buy. The earlier you can prepare and hunt for a bargain, the higher your success rate can be.
One thing you can do is that if you have a favorite shop, ask the owner to let you know once they put particular items on sale. You might want to enroll in their mailing list so you get the news as soon as they put it out. This might be a little challenging since CNBC shares that a lot of people are not opening emails even when it is about privacy updates. You can also look at some of the items online and make sure you monitor their promos and discounts. Just be wary about delivery cost because it can be a deal breaker when you look at the amount you save with the discount.
Use your talent to create a personalized gift
One of the best things you can do to help your holiday budget survive another year is to look for ways to lower down the final cost. Once you have the list of names of people you want to buy gifts for, you start thinking of the things they might want. Once you total this list, your initial reaction might be to try and skip the holidays altogether.
However, there are ways to lower down the final cost and one of them is to make the gifts yourself. Take into account your talents and skills and find a way to make special and personalized gifts. If you love baking cookies, start dusting off your oven and stacking on ingredients so you can practice baking cookies. The idea is to use your time and talent to make inexpensive yet personalized gifts for people.
Separate holiday spending from your regular budget
One of the overlooked aspects of a holiday budget is to make sure that you separate it from your regular monthly budget. Your bills and daily needs will not stop just because you are planning for the holidays. This is one of the main reasons why you need to plan it separately. It also goes without saying that you need to have a separate fund for it as well.
If you try and put it in your regular and monthly expenses, you might be surprised to see that certain expenses shoot up. It will start to cause problems when you did not really save up for your holidays and simply decided to carry over the load to your regular spending. Having a budget for the holiday should also mean that you have a separate fund for it.
Use cash whenever possible (debit card will do)
As soon as you start shopping for the items you want to send a gift to people you love, it would benefit your holiday budget if you use cash as much as you can. It might be inconvenient at times especially when you are used to simply bringing your credit card for payments. Not to mention that carrying credit cards in your wallet is a more secure option.
However, paying with cash also has its benefits. For one, you get to see the money leaving your hands and it makes you understand the exchange even more. You get to appreciate how hard work equates to cash and what you can buy with it. It also tends to make you budget better because once you have used up all the cash you brought with you, that’s it. You cannot pay for any more purchases so you limit overspending.
Track your spending
When talking about your holiday budget, one thing you need to accomplish is to track your spending. You may have a budget but that will be of no use if you keep on spending more than it. The best way to do this is to track your spending. Have you budget with you always so if you buy something from the list, you get to check. Check the amount you have set and make a conscious effort to spend less than it. It will help you be more creative and save money in the process as well.
Christmas is just around the corner that is why it is becoming all the more important to have a holiday budget. The sooner you have one, the easier it would be to buy the gifts early on. It can be one less thing to worry about as the holidays come closer.