The Time to Start Saving for the Holidays Is Now

The holidays will be here before you know. Are you financially prepared? If not, it's time you got serious about saving for gifts and entertaining.

The 2022 holiday season is shaping up to be the best and biggest we’ve had in years. But unfortunately, all of that holiday cheer can come with a hefty price tag. If you want to treat your family to the best gifts and entertain with flair, then you need to start saving right now.

Here’s how to successfully set a holiday budget, stop yourself from getting overwhelmed or carried away, and save money painlessly for the next three months.

Set Your Budget

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The first step in sticking to a budget is to have one in the first place. This budget should include gifts, food, travel, and décor for the entire holiday season. Figure out how much you can reasonably spend without using credit cards. Many people splash out on the holidays by using credit, only to pay interest for the rest of the year as they chip away at the debt. If you ask me, that’s not keeping in the spirit of the season.

Divide your planned budget by the number of paychecks you’ll receive between now and the holidays. That will give you a target for savings.

Trim Your Personal Spending for 3 Months

To bolster your holiday savings, cut back on unnecessary spending for the next three months. That could mean making coffee or cooking more meals at home, strategically planning your errands to save gas, or pausing a streaming service subscription.

If you’re not sure where all the money is going each paycheck, then it’s a good idea to write down everything you spend for two weeks. That should give you a snapshot of your spending habits and allow you to see areas where you can cut back without feeling too deprived.

Read More: The Best Budgeting Apps of 2022

Pay Cash, Save the Change

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Another painless way to save is to start paying cash and stashing your coins in a big jar. It’s an old-school method of saving that works really well. Best of all, the whole family can get into saving this way since a coin jar makes progress obvious to even younger kids. Designate one goal, such as taking a trip or buying a gift that everyone in the family can enjoy. That way, your entire household can get into the spirit of saving.

Does Everyone on Your List Really Need a Gift?

What percentage of your gift list is only there out of obligation? Do you really need to buy gifts for those distant cousins? We often feel a lot of pressure to be generous during the holidays. However, people are increasingly conscious of the negative impact that clutter has on our well-being, as well as the environmental impact of cheap, mass-produced goods.

Look at your gift list and ask yourself if you really need to buy a gift for someone you barely know and only see once or twice a year. Rather than buying gifts, consider simply sending a card or boxing home-baked treats for everyone in this “tier” of your gift list.

Clear Out Your Clutter

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Speaking of clutter, now is the perfect time to start clearing out the junk from your own house. There are a few reasons why this is a great idea. First, you’ll get a head start on making your home “company ready” for entertaining in November and December. You can donate the things you no longer need or want, which could make someone else’s holidays a lot brighter, or you can sell things on eBay or Facebook Marketplace to earn a little cash! There’s also a possibility that you’ll find treasures for regifting, which can cut down on your shopping list.

Read More: Smart Ways to Convert Your Clutter into Cash

Ask for Gift Requests Now

While you’re working on that gift list, ask your nearest and dearest what they might like this year. If they don’t know, encourage them to start thinking now. It’s always better to get someone a gift that they’ll cherish or use every day. You can also work on coordinating with other family members to go in on a bigger gift together. Finalizing your gift list early will make the next savings tips on our list possible.

Set Sales Alerts

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As you figure out what you’ll buy this year, create alerts for when those products go on sale, or new coupons become available. One of the easiest ways to do that is with Google Alerts. If you use the shopping companion app Honey, you can create a “Droplist” of items that you’d like to buy. Then, whenever the price drops, you’ll get an alert. Read more about Honey’s Droplist here.

Maximize Credit Card Perks

While you’re shopping, make sure that you maximize the savings and cashback opportunities on your credit card. Many cards offer rewards on certain purchases from partner stores or even gift cards. You may also be able to redeem points for coupons or cold, hard cash.

Just remember that these perks won’t actually save you money if you don’t pay off the balance in full. If you know you’re likely to overspend on credit, stick to cash or debit.

Prioritize Experiences Over Material Goods

Skating in New York City

Buying gifts for everyone on your list can quickly become overwhelming. If you’re trying to cut back on spending—or simply live a more minimalist lifestyle—then you might want to rethink gift shopping altogether this year. Ultimately, people remember experiences more than material things, so why not focus on making memories this year?

If you’re on a strict budget, then check your community calendar for free holiday events such as parades, tree lightings, or concerts. Even if you’re not expressly trying to save money, you might still consider adding some free or low-cost events to your holiday calendar.

Take a Pantry Inventory

Entertaining can be seriously expensive during the holidays. For many people, food is an expression of love—and since you love your friends and family so much, there’s always a temptation to go overboard when you’re hosting.

Before you rush out to the grocery store, take a look at what’s already in your pantry. Most frozen goods and pantry staples will last you through the holidays, and you might be surprised at what you already have on hand. You can also take advantage of sales on non-perishable items over the next three months, along with certain things that will keep in the freezer like butter or turkey breasts.

Buy Decorations Now

The most wonderful time of the year seems to start earlier and earlier, doesn’t it? You can already scoop up holiday decorations at most retailers, and the prices are often better now than in the weeks immediately before the big days. You can also pick up secondhand and vintage décor for next to nothing at thrift stores, yard sales, and estate sales over the next few months.

Bundle Gift Cards and Save

Montreal, Canada - April 6, 2020: Different gift cards of many brands such as Amazon, Netflix, Xbox, Google Play, Best Buy, Spotify. A gift card is a prepaid card that you use to pay for purchases
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Who doesn’t love a gift card? When you’re not sure what to get the people on your list, a gift card to a popular restaurant or coffee shop is a safe bet. Even better, you can buy gift cards in bundled packs for a steep discount. Costco and other discount clubs offer wonderful discounts on gift cards. You can often get an additional card free when you buy a bundle—and if you want to keep that one for yourself, I won’t tell anyone!

Read More: Holiday Gift Ideas That’ll Last a Lifetime

Buy Holiday Cards in Bulk

While you’re buying in bulk, don’t forget to stock up on holiday cards! The time is right to get the best deals on the biggest variety of cards. One of the best places I’ve discovered for bulk greeting cards is Aldi! They typically have packages of all-occasion and/or holiday cards this time of year for pennies on the dollar compared to premium greeting cards. For far less than luxury brands, Aldi also sells deluxe cards with foil, 3D artwork, and other embellishments.

Buy a book or roll of Forever stamps while you’re at it so that you won’t have to brave the post office during the busiest season of the year.  

Order Everything at Once to Save on Shipping

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Almost 90% of shoppers buy gifts online, so chances are good that you’ll be doing at least some of your holiday shopping on your phone or computer. Shopping online offers many of the same deals as Black Friday sales—but without having to fight someone over a new TV in the aisle of the store.

If you plan to shop online, do so strategically. Once you’ve finalized your gift list, figure out where you can get the items for the best price. Then order everything from each retailer simultaneously so that it all arrives in one shipment. You’ll pay a lot less overall for shipping.

Book Your Travel Tickets ASAP

Holiday travel is a time-honored tradition, and it’s likely to be more popular this year as loved ones reunite after lockdowns. Expect plane tickets to be more expensive than usual. Experts recommend booking your tickets by the end of October in order to score the best prices for Thanksgiving travel. It’s also possible to get a much cheaper ticket by traveling on the holiday itself or by traveling midweek instead of on weekends.

Open a Holiday Savings Account

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While it’s too late to join a holiday savings club at your bank for this year, add it to your to-do list for next year. These programs hang onto an amount that’s direct-deposited each paycheck, earning a small amount of interest, until they pay out in October for holiday shopping. You’ll be ready to have the best, most festive, and most magical holiday ever in 2023!

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