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6 budget-busting expenses during the holiday shopping season



It’s hard to stick to a budget this time of year. These are the things to watch out for.

Woman sitting on bed wrapping presents

Between Thanksgiving and New Years, you’ll be presented with an almost limitless amount of opportunities to spend more money than you bargained for, what with travel, parties, gifts, dining and more.

We wondered which holiday budget busters to watch out for during the holiday shopping season, and how we’ll make it to January in one piece. (Financially speaking, at least.) For answers, we asked Natalie Taylor, CFP and director of financial advice at Monarch Money. Here’s what she told us:

In this article:

Start by making a budget

Regardless of your income or your priorities, the holidays can be a significant financial commitment—whether you’re spoiling relatives with gifts or just splurging to see them for one time of year. So treat them that way.

“One important thing is to add up the numbers ahead of time, rather than going into the holiday season and taking each purchase as it comes,” says Taylor. “Take 15 minutes to budget for the expenses that come with the vacation.”

“Find out who you’re buying for and what the budget range is for each of these gifts,” she continues. “Find out what trip you’ll be taking and what food you’ll need if you’re hosting. There is also postage for Christmas cards and gifts. Just spending a bit of time playing a bit of numbers makes a huge difference, because then you can see where it all adds up and hopefully not pay it off in the new year.”

And now, the expenses to watch out for:

Hosting

A surprising source of holiday spending? Having people over. “With inflation and food prices being so high, I think sometimes when we’re cooking at home we forget to consider the cost of all the ingredients and everything that goes into hosting,” says Taylor. “We think about gifts and we think about travel, but if you’re the host, it can get pretty expensive.”

To lower your vacation costs, “don’t be afraid to pick people up when they say they want to bring something,” says Taylor. “In fact, pot luck can be a great way to do it if you make the main course and everyone brings sides; that can make a huge difference to the cost. There’s also nothing wrong with asking your guests to bring a bottle each.”

Speaking of booze, when buying yours, consider buying in bulk. If you shop for alcohol for Christmas and New Years at the same time as your Thanksgiving shopping, you’ll get discounts and save on shipping (and it’s not like the wine will go bad). Just make sure to keep the bottles in separate places at home, so you and yours don’t accidentally go through them all during Thanksgiving.

Sending holiday cards

This can be a sneaky way to blow your vacation budget. You can go big (hire a photographer) or small (choose a few candid photos from the past year). You can go fancy with the design or stick to something more basic.

And as Taylor notes, “if you’re doing holiday cards, if you’re doing the postcard version, instead of doing the card that’s opened and sent in an envelope, the postage is about 50% less,” Taylor says. This is also more environmentally friendly – and it’s also more likely to end up on someone’s fridge than a traditional card would.

Gifts

There are people whose gifts you probably won’t skimp on (like your spouse or kids, if you have them), but there are others whose gifts could reasonably be more, ahem, financial.

“There are alternatives to buying something for everyone on your list,” says Taylor, and you might want to look into them “once you’ve added up the costs of all your gifts.” As an example, she suggests baking something for someone that costs a few dollars per person, instead of buying expensive candles for the hosts. As a bonus, “me and my family will enjoy doing it.”

Something you make by hand, or something that shows more thought and creativity than a price tag can, will generally set you back less than something bought in a store.

You can also measure your expenses in other ways. Some gift recipients – e.g. a sibling or parent who can afford nice things for themselves – might appreciate a donation to a favorite charity, rather than you spending money on something you think they’ll like. Or you can give them something sentimental but inexpensive, like a framed photo or a book of pictures of your family.

Act

So it’s a way to save money on gifts. But if you buy things, another way to save money is to track sales. Black Friday and Cyber ​​Monday can both be great times to get cheap gifts—if you’ve already figured out what you might want to get people. So start thinking now.

If you’re planning to get clothes for anyone, there will also be smaller but significant sales between now and the weekend as stores switch out their seasonal offerings. (Yes, that means you might not buy any winter gear while on vacation, but one could argue that it’s more festive to buy warm-weather clothing like a bathing suit.)

The other benefit of shopping ahead is that it reduces the risk of buying gifts at the last minute, which, in addition to being stressful, often results in you paying more than you wanted for gifts that are just what you intended.

Traveling

The simple arithmetic of supply and demand ensures that the holidays – when everyone wants to travel and there’s only so much fuel for planes and cars – are an expensive time to go anywhere, no matter how you’re going.

If you’re traveling by air, flexibility can help. “On travel sites like Kayak or Expedia, you can see the easy double or triple dollar sign days to travel, so flexing a day or two can really help,” says Taylor. (Depending on your relatives, it might sound like fun or like punishment to visit them a day or two early, but there’s a good chance it will save you money.)

If you drive, apps like GasBuddy or Upside can help you plan ahead by showing how much gas costs at various stations along your route. If you time your stops to stations with lower fares, rather than just driving until you hit empty, you can save a few dollars each way.

If you have your choice of cars, either at home or from a rental location, you can also save money by choosing the most fuel-efficient option. (It’s also a nice holiday gift for the planet.)

Self-gift

Of all the various expenses that only seem to pop up during the holidays, one of the more avoidable is self-gifting. If you spend a lot of time shopping for others, you’re likely to come across some things that you would like, and maybe even feel like you deserve them.

And hey, maybe you do. But still, try to refrain. If you can make it through the holidays and into January without a deficit (and in a position to hit your savings goals), you should consider it the greatest gift of all.

Our editorial policy

Haven Life is a customer-centric life insurance agency supported and wholly owned by Massachusetts Mutual Life Insurance Company (MassMutual). We believe that navigating life insurance decisions, your personal finances and overall well-being can be refreshingly simple.

Our editorial policy

Haven Life is a customer-centric life insurance agency supported and wholly owned by Massachusetts Mutual Life Insurance Company (MassMutual). We believe that navigating life insurance decisions, your personal finances and overall well-being can be refreshingly simple.

Our content is created for educational purposes only. Haven Life does not endorse the companies, products, services or strategies discussed here, but we hope they can make your life a little less difficult if they fit your situation.

Haven Life is not authorized to provide tax, legal or investment advice. This material is not intended to provide and should not be used for tax, legal or investment advice. Individuals are encouraged to obtain advice from their own tax or legal advisor.

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