By Jeff Rotherham, CFP®, MSAFP
As we quietly slip into the holiday season, most of us look forward to delicious food, families reuniting and great festivities. This is also the season when managing finances can be challenging. You do a little shopping here, a bit of dining there, and sprinkle in some online gifts and the next thing you know you have doubled what you are comfortable spending. Of course, right when you think you have your shopping all wrapped up you realize you have forgotten that crazy uncle or quirky friend. Or, if you are like me, sometimes you just get swept up in the holiday spirit, throw caution to the wind, and purchase those special gifts only to wake up in January with a credit card hangover.
Below are some tips I’ve found that can help keep the holidays both healthy and happy:
- Make a list and check it twice. A good first step is to make a list of all those to whom you would like to give. This has become much easier in the digital age. You can make a list once on your computer or smartphone and simply tweak or update it once a year. Feel free to have categories as you see fit such as family, friends, coworkers etc. The point is to get an idea of whom you would like to give to so you are not making last minute or impulse purchases. Also, it is important to realize that giving does not have to mean buying something. Service, spending time, or other activities are also meaningful. For those of us who like paper and pencil, keeping a journal is a great way to go. Having a plan can declutter your mind while saving time, energy, and worry.
- Decide on your limits. Now, with step one completed, set limits to your budget. This is where breaking your list down to categories can be helpful. For example, you may decide that instead of movie tickets for your coworkers you need to go with $5 gift cards to their favorite coffee house. At this point, do your best to match your intended giving to those on your list.
- Take advantage of sales. Black Friday used to be that one day when there were spectacular sales available. Now there are multiple sale periods from which to choose. Many online retailers and stores have incredible deals starting in November that last through the end of the year. Just FYI, some deals are only made available to those following specific retailers on social media. Cyber Monday (the Monday after Thanksgiving weekend) is also a day when shoppers can find great discounts on gifts.
- Get industrious. This is a great way to get the family involved and do something unique. When my wife and I were in our twenties, we had a VERY limited spending capacity. Instead of buying gifts, we would make homemade jam and decorate the jars. These types of gifts can be both thoughtful and cost effective.
- Gift exchanges and other ideas. Gift exchanges can be fun and exciting and are a great way to minimize cost while spending time with friends and family. Lastly, there a few families I know that simply don’t do gifts. They enjoy a warm and entertaining holiday season by spending their time savoring meals, caroling, looking at holiday lights and other activities.
Remember, with a little preparation this time of year does not have to break the bank or be overly stressful. Try taking a little time to plan and enjoy what matters most to you. Happy Holidays!
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