The holiday season is a time for celebration, centered around family, friends, gift-giving, and festive activities. It often brings joy through home decorations, special meals, and community events. However, it can also bring stress due to the challenge of managing finances while trying to find the perfect gifts.
Andrew Zumwalt, chair of the University of Missouri’s personal financial planning program, shares practical tips to help you manage your holiday spending while maximizing enjoyment.
How can I prioritize spending on gifts, travel, and holiday activities to bring the most joy without overspending?
Start by creating a spending plan and sticking to it, adjusting as necessary. Think about what the recipient would truly value—whether it’s a thoughtful item, shared experiences, or even financial support. Focus on understanding their preferences to ensure the gift is meaningful. Avoid giving something that might not align with their needs or interests.
What tools or apps can help me track holiday expenses in real-time?
Keeping track of expenses is essential, whether it’s with a small notebook, a digital note-taking app, or an envelope system for cash. The method doesn’t need to be complicated—what matters is consistency. Choose a system that fits your lifestyle to avoid overspending.
What strategies can help me take advantage of sales and promotions without falling into impulse buying?
Comparison shopping is key. Check prices across multiple stores to ensure you’re getting the best deal, as some discounts may be exaggerated by inflated “original” prices. Focus on buying clearance or off-season items for greater savings. To avoid impulse purchases, take a moment to step back and evaluate if the deal aligns with your needs.
Should I use cash, debit, or credit for holiday spending, and how can I avoid going into debt?
Spending habits vary depending on the payment method—people often spend more with cards than cash. The most important thing is setting clear limits and staying honest with yourself about them. If self-control is a challenge, consider involving a trusted friend or family member to help you stay within your budget.
What are some creative ways to save money on holiday traditions like parties and decorating?
Focus on balancing your plans with quality time spent with loved ones. For example, instead of handling all the cooking alone, invite others to join in the kitchen, making it a shared experience. Establish meaningful, low-cost traditions like decorating together or volunteering as a group. Encourage younger family members to suggest new traditions that bring joy without adding significant expenses.
How can I avoid financial stress in the new year by planning my holiday spending now?
Keep your future self in mind. Place a photo of yourself from earlier in the year in a visible spot and label it “future self.” Use it as a reminder to think about how you’ll feel after the holidays if you overspend. This can help you make thoughtful decisions and stick to your budget.
Should I start saving for next year’s holiday season, and how can I prepare for long-term financial goals?
Don’t let long-term planning distract you from managing the present. Focus on getting through this holiday season first. After the holidays, take time in January to reflect on your spending and note what worked well and what didn’t. Set a reminder for October to review and start preparing for the next year, giving you plenty of time to save and plan.
By taking these steps, you can enjoy the holidays without the stress of financial strain, ensuring that the season remains a time of joy and connection.
