How does your holiday spending compare?
Between the food, the gifts, the travel, and all the other little expenses, it doesn't take long to rack up a huge holiday bill. The average American's holiday expected budget is $708.03, according to YouGov, an international polling and market research company, and 12% of Americans admitted to spending more than $1,000 per year on the holidays.
Even more concerning, some of those surveyed reported taking on debt to cover their holiday costs. Dealing with the consequences of out-of-control spending is no way to start off the new year, so give these tips a try to cut back on some of the most common holiday expenses.
The YouGov survey found that on average people plan to buy about eight gifts. The survey doesn't disclose the average amount spent per gift, but even if you only spent $20 on each one, those eight gifts will cost $160. If you spent $50 per gift, now you're talking about $400. It adds up quickly. And 22% of Americans will buy 11 or more gifts this year, which will push the bill even higher.
You can prevent your gift spending from spiraling out of control by deciding how much you can feasibly spend in total and then dividing up this amount among all of the people you must buy gifts for. Another option is to set up a gift exchange with your family. You agree on a price limit and each of you only need to buy one gift for one other person. This makes the holiday shopping season a little simpler and could save you all a few hundred dollars in the process.
Shop in sales, including Black Friday and Cyber Monday, but do your research beforehand to make sure that the deals are actually good ones. Pay attention to return policies, too, in case an item arrives broken or you or the recipient decide a gift isn't the right fit. If you're shopping online, be mindful of shipping costs, too.
Homemade gifts are another option if you have the time and interest to make them. This could be jewelry, artwork, or home decor. It might not be a suitable option for everyone on your list, but it could help you save on the cost of a couple store-bought gifts.
Approximately 60% of Americans plan to travel this holiday season, according to the YouGov survey. If you're only traveling across the city or to the next town over, it might only cost you an extra tank of gas. But if you're flying, plane tickets, baggage fees, and all the extra little charges could cost you between several hundred dollars and over $1,000, depending on where you plan to go.
You can reduce your travel expenses by planning well in advance and watching for the best deals. Be flexible with your travel dates; flights are usually cheapest midweek. My family has often saved money on flights by traveling on the holidays themselves, too. Most people hope to be at their destination by then, so these flights might be slightly cheaper than right before or right after the holidays.
Use credit card rewards points if you have them to save on the cost of flights, hotels, and other travel expenses. Consider using your travel rewards card for your holiday purchases to help you earn rewards more quickly, but don't spend so much money chasing rewards that you end up carrying a balance you can't afford to pay off. You'll also want to check with your card issuer to see if it has blackout dates around the holidays.
If everyone comes to you, it's a good way to save on travel costs. But then you're looking at increased costs in other areas, like food, drinks, and even electricity from the additional use of lights and appliances. These expenses probably won't cost you as much as gifts or travel, but you might still spend a few hundred dollars on a holiday feast.
Scan your local newspaper and check online for coupons. This can help you shave a few dollars off your grocery bill. You could also agree to do a potluck dinner with your family instead, but then you must coordinate with everyone to decide who is responsible for bringing what.
Your family might have holiday activities planned that could cost you money, like a movie or some other outing, so don't forget to think about these, too. You could also check for coupons for these events, or suggest a free alternative if you're not willing to spend money on paid events.
Unless you plan on staying shut up in your house alone this holiday season, you probably can't avoid spending money. But hopefully the above tips can help you shave your costs without compromising on the things that you enjoy.
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