The holidays are fast approaching, and ‘tis the season of spending! With friends and family to shop for, and good deals to hunt down, budgeting is more important now than at any other time of year.
Mandy Kelso, TD Bank's Head of Financial Education, provided tips for getting ahead of holiday expenses and managing spending.
Make your shopping list ahead of time
Before shopping, make a gift list with a budget for everyone on it. This simple step will help keep you focused once you're ready to shop. Research prices and sales at competing sellers. By knowing exactly what you want to buy, where to find it, and when to make the purchase, you'll find it much easier to stick to your budget. A little planning will go a long way toward making your shopping experience cost-effective.
Stick to your list!
Stay committed to what you need, rather than getting distracted by enticing items on shelves or displays.
According to Mandy, if your plan is “based in reality and representative of the ones that you love,” then there’s little reason to waver from it once you’ve begun the shopping process. “The more planned you are, the more financially secure you are going to be coming out of the season.”
Pay in cash
If you’re shopping in-person, paying with cash is a great way to manage spending. If you bring a set amount of cash with you into a store, you can’t spend more than what you have. Therefore, you’re forced to stay within your budget. If you remember the importance of developing your list and budget ahead of time, cash further helps you stick to the plan.
Don’t fall for the ‘good deal’
Many holiday deals, like free shipping when you spend a certain amount, don’t always save you money in the long run. For instance, if you spend $50 more to get free $15 shipping on an online order, you’re still spending more than you planned, and the cost outweighs the benefit. In this case, you are losing money in the name of a ‘deal’.
As Mandy says, “You can’t play the seller's game, you have to play the buyer’s game!” Always keep your financial interests in mind and resist the temptation of deals that might not be worth your hard-earned cash.
Give experiences instead of material gifts
When thinking about what to give your friends and family, consider an experience to show your gratitude and appreciation for them rather than something material. For example, a fun night of activities that includes a white elephant party is a great way to enjoy the company of your loved ones without breaking the bank. You could also arrange grab bags filled with simple gifts or homemade treats to hand out during a gathering. These kinds of experiences create lasting memories and meaningful moments that your loved ones will remember fondly for years to come.
Another thoughtful experience-based gift, if budget-friendly, is a subscription or membership. For example, offering something educational and fun for all ages can be a great gift for a whole family. Consider giving a membership to a zoo or aquarium, tickets to an ice skating rink, a membership to a local community garden or library, and so on. However, these options aren't always more economical than traditional gifts—it depends on the type of experience and the cost of the membership. As always, be sure to do your research and compare prices before deciding.
Consider handmade or DIY gifts and baked goods
On the topic of meaningful gifts and experiences, homemade items are especially popular, particularly when crafted from the heart. Mandy suggested asking yourself when considering homemade gifts for your loved ones: “What are things that we can make from our heart or make from our home that have meaning?” Homemade soaps and chocolate-covered nuts are an indulgence that not everyone allows themselves, which is why receiving your very own homemade batch as a gift means all the more.
She explains, “we can give indulgent, meaningful gifts, and they are even more meaningful when we make them ourselves.”
Handmade gifts like cookies, decorative wreathes, crochet or knitted pieces, pottery, or homemade sauces, jellies, and jams often carry deep sentimental value for both the giver and receiver. These thoughtful creations embody the true spirit of the holidays, offering much more than monetary worth and easy-to-make DIY gift-making tutorials and recipes abound online.
Post–Holiday sales
Once the holiday season ends, it's time to focus on financial recovery. However, this is also when post-holiday sales and offers flood in, tempting you to spend even more. While these deals may seem appealing, it’s important to stay cautious. If you have had your eye on something that you know will go on sale after the holidays, make sure you include it in your holiday budget if funds allow. The main thing is to have a plan so you can stick to your budget rather than getting swept up by potential savings. Exercising financial discretion after the holidays is a smart way to kick off the new year and sets a solid foundation for the next holiday season.
For more on personal finance topics
If you have more questions about personal finance topics, visit the Learning Center on TD Bank's website. You can find more TD Bank services at TD.com.
We hope you found this helpful. This article is for informational purposes only and is based on information available as of November 2024 and is subject to change. This content is not intended to be used or acted upon with respect to any client's specific circumstances. For specific advice about your unique circumstances, consider talking with your qualified professionals.
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