6 Tips for Taking Some of the Financial Stress Out of the Holidays


With the holiday season fast approaching, many Americans are already making plans for “the most wonderful time of the year.” And by and large, the season is filled with things to look forward to, such as holiday traditions and time spent making memories with friends and family.

But unfortunately, not all aspects of the holiday season are quite so joyous — especially when it comes to finances. In fact, according to a recent poll, nearly one in five parents report experiencing high stress levels during the holiday season, with household finances being among the top contributors to their anxiety. And another recent survey finds that over a third of Americans take on holiday debt, with the average amount topping $1,200.

6 ways to manage the seasonal stress and debt

Some good news is under the tree, though, especially for those who can get an early start on their holiday shopping and planning. By having a plan in place and incorporating a few holiday hacks, consumers can minimize the toll that the season tends to take on their finances.

Consider these six tips for establishing and stretching your budget over the holiday season:

  1. Make a list, and check it twice — Well before the gift-buying season begins, sit down and make a plan for your upcoming holiday purchases. Create a list of all the family members and friends you intend to buy gifts for, along with some gift ideas and a budgetary ceiling for each recipient’s present. Further, account for any additional seasonal expenses you might anticipate. Will you send out holiday cards? Are you traveling for the holidays? Will you host any holiday parties? Include all of these items and any others you might anticipate on your list, along with an estimated price tag for each entry.
  1. Build out your budget — Once you’ve put together a list of your anticipated holiday expenses, calculate an estimated total for holiday season-specific costs. With this in hand, you’ll have a good idea of how much money you need to set aside to avoid taking on any extra holiday debt. And with a clear savings goal in mind, you can make a plan for putting the money aside — perhaps by allotting a specific dollar amount each paycheck or each month for your holiday fund. You may even want to consider opening a savings account specifically for your holiday savings, and setting up regular automatic transfers to fund it.
  1. Start setting money aside — Now it’s time to actually begin the saving process. To make room in your monthly budget for your holiday savings, look for opportunities to temporarily cut your discretionary spending. Some of the most common ways to do this include limiting the entertainment budget and reducing the number of meals you eat out, but you may find other chances to cut costs in your own monthly budget. And of course, the sooner you can start this process, the more time you’ll have to build up your fund (and the less you’ll need to set aside each pay period or each month).
  1. Find ways to trim gift costs — Before making any gift purchases, be sure to do your research to make sure that you’re getting the best price available. Online tools such as Google Shopping offer a great way to see pricing from a range of retailers, all in one place. And when you are inside the store, apps such as Price.com (available from the Apple App Store) and BuyVia (available from the Google Play Store) enable you to quickly see prices both online and nearby with a simple barcode scan.
    In addition, before finalizing your purchase, use websites such as RetailMeNot.com and CouponCabin.com to check for money-saving digital coupon codes and promo codes. And of course, “shopping holidays” like Black Friday and Cyber Monday present great opportunities to grab gifts and seize big savings during the holiday season. To get a sneak peek at the deals and plan your purchases, visit websites like blackfriday.com and theblackfriday.com.
  1. … and to creatively cut other holiday-related costs — With some creativity, you can find other ways to reduce your holiday expenses. Just a few ideas here include:
      – Go DIY to make personalized, handmade gifts for loved ones. (Nearly 100 DIY gift ideas can be found here.)
      – Coordinate gift exchanges among friends and/or family members where, rather than everyone buying separate gifts for each and every person on the list, each gift-giver in the group is responsible for just one person and one gift. (This could even create more room in the budget — for everyone involved — and thereby allow for bigger, more expensive gifts to be given.
      – Give the gift of time by pairing a handwritten holiday note with an offer to, for example, babysit friends’ kids for them so they can have a date night. Other possibilities here include giving your spouse a day off from his or her chores or creating a DIY “coupon chore book” that allows the recipient to trade coupons for chore coverage by the gift-giver.
      – Gift a family heirloom with a note explaining the history and significance of the item.
      – If you’re artistically inclined, create an artwork (or write a poem or a song, etc.) for a loved one.
  1. Employ holiday hacks — A few other ways to stretch your holiday budget (and even treat yourself) include:
      – Many of today’s credit cards offer cash back or other types of rewards for making purchases with them. And by buying your gifts and paying for other holiday-related expenses with these cards, you can cash in the perks to reward yourself after the holidays. (Of course, to avoid paying interest, cardholders must pay off their full balance when due.)
      – Wholesaler retailers such as Sam’s Club and Costco often offer sets of gift cards for which the total purchase price is below face value. This can provide an opportunity to squeeze an extra gift into your budget without spending more — or to treat yourself to your own gift card after the rest are given as gifts.
      – On National Free Shipping Day, held each year on December 14, many retailers offer the chance to send your last-minute gifts with no shipping charges, sometimes with no minimum purchase required.