I am a last-minute shopper. I can’t help it—no matter how much I plan, it never translates to finishing my holiday shopping early. That being said, I do like to have a spending strategy!
Over the years, I’ve realized that, if I don’t set aside a certain budget, I can do some real damage in my zeal to get everything done. Here are my best tips for staying on budget during the holidays:
Create a budget
- • Know how much you can actually afford to spend this holiday season without falling into a debt spiral. Take a look at how much money you have after you pay your monthly obligations. How much of that can you spare for holiday gifts, entertainment and other holiday fun? If you choose to use a credit card, be sure to have a payoff plan in place so you’re not stuck paying interest all year.
Make a list
- Once you know how much you have, decide who you'd like to buy gifts for. Next to each name, write a rough estimate of how much you'd like to spend, making sure everything adds up to less than your total budget.
- • Shop ahead of time—and watch for sales
- • Start brainstorming gift ideas and look around to find the best price for what you want to buy. Compare prices and don’t forget to figure in shipping costs.
Take advantage of your credit card
- • As you shop around, consider using credit cards—you could earn a significant amount of points toward cash back or rewards. Figure out which one of your credit cards would earn you the most points and designate that one as your holiday shopping card. Keep in mind that responsible credit rules still apply during the holiday season, so don't overspend, and pay off your balance as soon as possible.
Track your spending
- • However you choose to spend this holiday season, keep careful track of how much you spend, where you spend, and who you're spending on.
Automate your savings
- • If you find budgeting for holiday shopping too stressful, take some of the work out of it by automating transfers to a savings account. Look at how much you spent this year, divide it by 12, and set up a direct deposit from your paycheck or checking account into a savings account each month. By this time next year, you'll have the money put aside and ready to spend.