November 16, 2023
The most expensive time of the year has arrived, but most of us are making the same old wages we earned before the inflation spree. As prices go up, up and away, figuring out how to keep pace with holiday giving can be hard.
We all want to give thoughtful gifts, but we don’t want those gifts to leave us with debt we have to climb out of all next year. So, what’s the solution? Well, our biggest priority should shift to focus on ways to save for the holidays and more specifically: how to save money on gifts.
Here are our tips for staying afloat and gaining the financial advantage as you shop this season:
1. Set a Firm Budget
You need an all-inclusive budget — an itemized dollar amount that accounts for every gift you intend to buy. If you plan on making presents, be sure to account for the cost of supplies. The budget must account for and cover every gift for every person on the list. So, make your lists, and check them twice. (And yes, firm means firm.)
- For recipients. Family and friends will definitely be on there, but you may also have to account for work, school, church, service providers, caregivers and neighbors, for example. If you’re invited to social gatherings, you may need at least a host or hostess gift. If you have children, their friends and activities that they participate in can make the list longer.
- For costs. The next step is to assign dollar limits for each gift recipient. Doing this up front can be tough but eye-opening in just how much you’re thinking of spending, what you realistically can afford and how you’re going to allocate those funds. For some individuals who provide certain services, holiday tips may be appropriate, but you still need to account for them.
While budgets and lists may eliminate some of the spontaneity that can make shopping fun, they can save you from overgenerous gestures that often don’t deliver the impact we imagined. They also offer control for the seemingly never-ending list of small gifts that can nickel-and-dime a budget by hundreds of dollars as well as big-ticket items that can throw a budget way off balance.
2. Use Gift Search Filters
Online shopping apps and retailer websites offer all sorts of searches and ways of filtering your results. You can usually narrow your search by gift recipient and dollar limit or cost range. You may discover items that are better than what you might have otherwise given. Once you know what you’re planning on buying, you can use cost-comparison apps that will find it at the best price. Some will even reimburse you if the price goes down after you purchase the item!
3. Take Advantage of Free Shipping
Whether you’re sending a gift to someone far away or ordering for delivery to your home, shipping can consume a significant portion of your gift budget — especially if most of your shopping is done online. You’re almost always better off buying from a company and having it shipped to the recipient than buying it yourself and trying to ship it. Look for free shipping offers and promo codes. Many companies will offer free shipping for purchases that meet certain requirements. Buying multiple gifts from a supplier may be cheaper than paying the shipping. Buying early can also avoid expedited shipping costs.
4. Opt for Kid-Only Gifting
Limiting gift giving to the young people at a gathering can relieve a lot of stress in holiday situations that involve presents. On one hand, it can lower expectations. If adults get nothing, the fact that the kids get something magnifies the gift — even if it’s just something small and fun. On the other hand, it can leave you more financial room to buy nicer gifts for the children involved. If gift exchanges are planned, setting suggested spending limits will help ensure all the adults are comfortable with expectations and that children are gifted fairly.
5. Make a Game of Gifting
Secret Santa and steal-the-gift exchanges may be the most well-known of gift-giving games. However, they all work on the concept of relieving the burden of gift-giving within a large group of people. They’re popular with large families, workplaces, and schools. All sorts of variations have developed that you can play with dice, card games, coin tosses and more. One version lets you steal a gift only if you can beat the present’s current holder at a game of Rock Paper Scissors!
6. Give Fewer, More Selective Gifts
More is not always better or more appreciated. Some families are adopting a four-gift rule for children, but it can also work for adults. Rather than collecting a heap of presents, each recipient gets four gifts — something they want, something they need, something to wear and something to read. Some versions add a fifth gift — something to experience. It’s a great way to put gift giving in perspective while limiting ways to go overboard. And the best part? It can work with any budget, too.
7. Have a Plan
We know we’re about to sound like such a parent, but we all know when the holidays are coming. They happen each year without fail. Rather than helplessly watch them approach, we suggest preparing a holiday finance strategy in advance, and stick with it:
- Christmas club savings accounts are great tools for yearly planning. Each week or so, you pay into a short-term savings account with the goal of having money set aside to spend for the holidays. These types of savings plans are still around, and they’re a fantastic way to set aside shopping funds for anyone on your list.
- High-reward credit cards are another popular option when set aside to use only for the holidays and then pay off. With all ear-marked expenditures in one place, it becomes easy to track how much you’re spending and what you’re spending on.
- Some people choose to go the personal loan route especially if they’re considering big-ticket items. Working with a responsible lender can help you understand how budgeted payments will fit into your overall financial picture most effectively so you can truly enjoy a stress-free season.
Make Christmas Magic with La Capitol
At La Capitol Federal Credit Union, we want to help you maintain your holiday spirit of giving while also looking after your finances. If you’d like more information on how to develop a holiday money strategy, reach out to your nearest La Capitol branch, or visit our website. We offer competitive loan rates, credit cards with the kinds of rewards you can appreciate, and even Christmas and vacation club savings accounts. If you’re ready to learn new ways to save for the holidays, La Capitol is here to help.