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Holiday Gift Strategies to Soothe Your Budget

Updated: Apr 23

There are less than two months until the holidays. Around sixty days until Hanukkah, Kwanzaa, and Christmas and one of the busiest shopping days of the year is right around the corner. From Black Friday to Cyber Monday, the season seems to be an excuse to shop for gifts. The average American will spend just under a thousand dollars on holiday shopping. The National Retail Federation expects holidays sales to hit around $727.9 billion dollars this year.

While some pay with cash, close to three-quarters will pay with a credit card. Research shows that consumers will spend up to twice as much money when they use credit cards instead of cash.

If you’ve ever found yourself haunted by the ghosts of past holiday credit card bills, you aren’t alone. A quarter of those who used a credit card for their gift shopping haven’t repaid their bill nine months later.

Here are four tips to help you avoid feeling like Ebenezer Scrooge, or Bob Cratchit.

#1: Set Your Gift Budget

To avoid overspending during the frenzy of trying to find the perfect holiday gift, at a steal, amid the chaos of Black Friday it is essential that you know your budget. This is really a three-step process. First, make a list of who you’re buying gifts for this year. Do you have a long list of family and friends to buy for, or do you only exchange for those close to you?

Next, figure out how much you can afford to spend total. If you could only spend cash on gifts this year, how much would be available to you? Once you figure the first two out, decide how much you want to allocate to each person on your gift list.

#2: Make a List and Stick To It

Once you’ve set your gift budget for the season and for each person, put together a list of what you want to get everyone. This enables you to search out sales, shop around, and avoid impulse buys.

Gifts don’t have to cost a fortune. Black Friday and Cyber Monday feature some of the best door-busting deals around. But even if you don’t want to brave the crowds at five a.m. the day after Thanksgiving, you can find deals.

  • Look online for coupons and promo codes help save money.

  • Stores often offer a one-time percentage off if you sign up for the email list.

  • Websites like Honey, Rakuten,, and others can help you find the best deals.

  • Visit discount stores like Kohls, TJ Max, Marshalls, Costco, and Sams Club.

  • Shop online at eBay and Walmart, not just Amazon.

Once you have your list, and you’ve found your best price, stick to your list wherever possible. Don’t fall into the trap of browsing just to see what’s on sale, or shopping for yourself.

'Tis the season for giving gifts, but not to yourself! Not only do these impulse buys mess with your budget, they also make it harder for your loved ones to buy for you. Instead of picking up that random item you never knew you needed, put it on your list and pass it on when someone asks, “What do you want for the holiday?”

#3: Curb Costs on Kid's Gifts

The holidays are especially fun with children around. The winter festivities fill kids with wonder and excitement, from the holiday decorations, to getting to see family, to PRESENTS.

Children of all ages love getting presents. Heck, who doesn’t love a gift? But the cost of what kids want seems to climb higher year after year. And, let’s be brutally honest, kids always want MORE. Kids are influenced by a steady stream of commercials and marketing that can raise their expectations to unhealthy levels.

Throw in Santa, and the expectancy can become so unrealistic that there is no way to save them from disappointment—or their parents from bankruptcy as they try to fulfill these lofty dreams. It’s easy to understand why they might get confused. If a bearded man has magical elves who make toys, why can’t they have everything they want?

When children question Santa’s ability to fit down a chimney (especially if your home doesn’t have a chimney) or ride in a sleigh with flying reindeer, they are mature enough to develop more realistic expectations. Remind them that no one gets everything they ask for. This is a fact of life. If they bring you a long list, have them pick the things they want most. Tell them that Santa will do his best, but they will not get everything on their list. After all, they aren’t the only child asking for it.

Parents can turn the discussion around and emphasize giving and sharing as being hallmarks of the season, instead of these gift-receiving expectations. Many parents have their children choose a gift to give to charity, or “adopt” a child that’s less fortunate to illustrate a new perspective.

Remember, just because children fill their list with expensive or plentiful wants, doesn’t mean holidays have to break the bank. Kids, especially toddlers and babies, would much prefer several small gifts to one big one. And, at this young age, they’ll might prefer the box or bag to the expensive present inside.

One popular gift-giving tactic for kids is give them four smaller presents: one want, one need, one thing to wear, and one thing to read.

#4: Pay with Cash or Only Use One Credit Card

The easiest way to avoid overspending is to pay with cash. But, if you’re like many who hesitate to carry cash, stick to one credit card. It’s easier to track your spending and monitor activity for fraud if you are only using one account. If you use a credit card for your shopping, check your statement regularly.

You may also want to avoid “reward chasing.” The store-specific cards might tempt you to earn rewards, but you could end up paying more in the often-higher interest rates than what you would save in rewards. Not to mention, even applying for a store card goes on your credit report.

Have a Happy (Smart) Holiday Season

Using these four tips can help you reign in your holiday spending. The financial strain of the holiday is only one of many reasons “the Holiday Blues” are a very real thing. Creating and sticking to a budget can limit the stress of an unexpectedly high credit card bill, and the ongoing strain it can create.

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