It can be tempting to splurge on gifts during the holidays, especially in the wake of massive sales in stores and online, but the holiday season is a time where you should prioritize saving as the new year approaches. Fortunately, there are plenty of tried-and-true ways of saving money during this time.
Set a Budget
The simplest and most effective means of saving money during the holidays entails setting a strict budget and actually sticking to it. A holiday budget is different from a standard budget because most of the purchases being made will technically be non-essentials. When setting this budget, it is important to include all holiday-related expenses including gifts, food, travel, decorations, and even cards and stamps. Adding in some flexibility for impulse purchases or last-minute gifts can help save some stress later on, as well.
Don’t Forget Your Retirement Plan
Holiday spending can add up rather quickly and your retirement plan shouldn’t take a hit because of it. When you’re preparing your holiday spending budget, make sure you’re still factoring in room for your retirement savings; even if you decrease your monthly contributions a little. Keeping a consistent flow is key to maintaining the health of your retirement savings during times where you’re spending more than you typically would.
If you are doing any shopping in brick-and-mortar stores, it is advised to pay with cash. Keeping a set amount of cash on your person will prevent you from overspending; when it’s gone, it’s gone! For those who aren’t fond of cash or who plan to do most of their shopping online, credit cards can be dangerous. In general, credit cards should be used in place of cash; avoid buying anything you can’t actually afford and pay off balances in full when possible to keep your credit score healthy and avoid unnecessary holiday debt.
The holidays can be a stressful time, especially for individuals who are worried about their finances. Taking these tips into account can help prevent unnecessary stress and ensure the gift-giving aspect of the holiday season is affordable and successful.
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