Tips for Sticking to Your Holiday Budget

With goodwill in your heart and the spirit of the season surrounding you, it can be easy to overspend on holiday gifts. In fact new reports from the National Retail Foundation indicate that the average person is expected to spend $463 on gifts for family members this year and $805 in gifts overall. While shopping for your loved ones and delighting them with presents can feel wonderful, opening that January credit card statement doesn’t usually feel as great.

Since going over budget is practically an American holiday tradition, WiseBread recently highlighted some pitfalls to watch out for if you’re looking to break the habit. One of the biggest reasons people spend more than they intend to for the holidays is that they’re trying to match the perceived value of the gifts they’re being given. No one wants to look cheap to friends or family members, but don’t let that bad feeling ruin your finances. Regardless of what you receive or have received in the past, let your budget, not your guilt, guide you.

As part of your holiday budgeting you should create a list of everyone you will need to buy for ahead of time. Be aware that as the big day approaches you may feel tempted to add to that list. While a few dollars here or there might not seem like much, it can add up very quickly. Therefore it’s best to stick to your list and avoid any last minute additions.

If you’re like many Americans you probably receive some type of holiday bonus from your place of employment. Some companies have very structured methods for calculating these bonuses while others depend greatly on the success of the business that year. For that reason you should not count on your bonus to cover your holiday spending. The best part of this plan is if you do end up receiving a nice bonus, you can use it to invest or put it into long term savings.

Another important thing to consider when setting your holiday budget is the many other expenses associated with the season. One big example is travel. Whether you’re driving or flying home for the holidays, those costs are often significant and should be properly accounted for. Additionally if you work an hourly job, you may be taking extra time off that might not be paid.  Kicking off 2016 with disappointing paychecks can be a rough way to start your financial year, so you should plan for them well ahead of time and look into using any paid time off you may have accrued to make up for the lost hours.

In many ways what is supposed to be a joyous time can end up being one of the most stressful for the majority of us. When it comes to holiday shopping, make sure you have a game plan in place to protect yourself from financial failure. By creating and sticking to a disciplined holiday budget, you can help make sure you have a happy new year.

Author

Jonathan Dyer

I'm a small town guy living in Los Angeles looking to make solid financial decisions. I write for a number of finance websites, including HuffingtonPost and Business2Community. I founded DyerNews.com in 2015 to focus on personal finance and the emerging FinTech markets.

Other Articles by Jonathan Dyer

Carbon Credit API Cloverly Joins Visa's FinTech Partner Connect 

Last year, Visa introduced the FinTech Partner Connect program to the United States, with the goal of introducing institutions to vetted startups that could help them expand their product offerings. Now, the latest company to join the program is Cloverly. Founded in 2019, Cloverly is an API for carbon credits, allowing businesses and consumers to help fight climate change. As the company points out, with the Visa partnership, Visa clients...

Prosper Announces $75 Million Growth Capital Financing

A long-admired FinTech has added some new capital to its coffers and it continues to grow after more than 15 years in business. Recently, Prosper Marketplace announced that it had closed a $75 million debt financing round. This capital came from a fund managed by Neuberger Bergman and will be used to help Prosper meet the demand for its loans, credit card, investment products, and more. According to the company,...

Small Business Saturday 2022 Drives Projected $17.9 Billion in Sales

This past weekend saw the kick-off to the holiday shopping season with Black Friday followed by Small Business Saturday. Now in its 13th year, the latter is a promotion meant to raise awareness for small local businesses and encourage consumers to support them. Now, the initial figures from this year's event have arrived. According to American Express (which actually invented the retail holiday in 2010), an estimated $17.9 billion were...