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10 Ways to Save Money This Holiday Season

Holidays don’t have to be expensive. Here’s a sneak preview of our ideas to help you save money on a tight budget:

  1. Get an early start
  2. Budget and stick to it
  3. Trim your shopping list
  4. Avoid debt
  5. Skip the sales
  6. Moderate your holiday meals
  7. Consider a Secret Santa
  8. Focus on quality time
  9. Use what you have
  10. Give homemade gifts

It’s the most magical season of the year! The stockings are hung. The hot cocoa is poured. And your credit card bill is brimming with holiday … charges.

Going into excessive seasonal debt isn’t inevitable. You can have a merry and joyous holiday without letting your spending snowball out of control. We’re here to prove it with 10 spirited ways to save money on a tight budget this holiday season:

Start planning early.

The holidays may be weeks or months away, but now’s the time to get started. Some of the best holiday sales happen long before December. That’s when you want to start stocking up on non-perishable essentials like decorations, gifts and canned foods. Otherwise, you risk paying more later; or worse, getting stuck with the last dented can of green beans on the shelf.

Set a budget.

Picture this: You go online to buy a seasonal gift for your favorite nephew. Three hours and five digital wallet transactions later, you have ordered the latest video game … plus three garlands, a robotic vacuum (but it was on sale!!), a dozen autumn leaf candles and an inflatable Santa from Amazon. Your willpower and your bank account are now drained.

Sound familiar? The key to avoiding seasonal overspending is setting a budget — and sticking to it. Before you buy your first decoration, take a hard look at your finances and see what you can reasonably afford this holiday season. Inside your overall dollar amount, set aside smaller budget buckets for categories like food, gifts and décor/home items. This brings us to our next holiday tip …

Don’t go into debt.

According to Magnify Money’s annual post-holiday debt study, the average American family accumulated $1,325 of debt during the 2019 holiday season.1 Ouch! If you don’t want to spend the next six months digging out of debt, you’ll need to stay on budget and avoid putting seasonal extras on your credit card. Pay for holiday purchases with your debit card to minimize overspending. This way, you won’t be encouraged to spend more than you have in your account.

Make your shopping list and check it twice.

It feels nice to give, but you may end up feeling naughty when a giant credit card bill arrives. Before you put two dozen people on this year’s holiday gift list, take a moment to think it through. Would a card suffice for more distant relatives? Trim your list down where you can, and then make a list of the people you need to buy for. Even better, figure out what you’re going to get each person, along with a budgeted amount you will spend, and stick to your plan.

Moderate your holiday meals.

Holiday meals can be a budget-buster, especially if you’re the one dishing up (and paying for) all the goodies. Do you really need 14 side dishes and five pies at Thanksgiving? Calculate how much food is really needed, then plan to prepare just a little extra. If you are gathering with others, split the cost and the cooking duties. Assign each person one or two dishes to prepare and let everyone know how many people will be attending so they can plan their servings accordingly.

Pump the brakes on holiday sales.

Sure, it feels great to score a killer deal on the must-have item on your partner’s wish list. However, if you’re prone to impulse shopping, it’s probably not a great idea to rush to the mall on Black Friday with cash in hand. (Yes, this also applies to virtual shopping, so resist the urge to click BUY NOW on Cyber Monday!) Instead, select necessary sale items in advance, buy only those items and pay using your debit card or digital wallet linked to your debit.

Replace individual gifts with budget-friendly alternatives.

While you may want to splurge on Christmas, Hanukkah or Kwanza gifts for your household members, do you really need to buy presents for your second cousin twice removed? For larger groups of family and/or friends, suggest a “Secret Santa” idea where everyone buys for one other person selected at random. If some or all of you are meeting up virtually, you can always mail your gifts or drop them off on the recipient’s porch.

Choose quality time over expensive events.

If you typically spend a lot of time at holiday concerts, dining out at restaurants or taking vacations around the holidays, this could be the year to pare back. Focus on easy and inexpensive (or free) ways to spend time with friends and loved ones.

For example:

  • Family game nights
  • Caroling at home
  • Baking seasonal treats
  • Decorating a holiday tree
  • Hosting a virtual Zoom party
  • Holiday movie nights

Check your local community calendar for other free or low-cost events.

Use the decorations you have.

It’s easy to get sucked in by the sparkling aisles of holiday décor at every big-box store. The tinsel! A gold menorah! That fancy pre-lit tree that turns 18 shades of red and green!! Unless you are a contestant on The Great Christmas Light Fight, you can probably make do with what you already have. Make new ornaments with your family, rather than buying expensive retail ones. Remember that the true magic of the season isn’t in animated lawn reindeer and life-sized nutcrackers.

Make a (good) gift.

If your list of presents to buy is large and your fam isn’t buying into the gift swap idea, consider going handmade. Don’t worry, you’re not limited to crocheted doilies and macaroni art. There are countless DIY videos and how-to blogs out there for items your crew might actually enjoy, like homemade mixers, camping kits, caramel apple butter and custom coasters. Pick your favorite and make a big batch to split into individual gifts. You could also opt to write a heartfelt letter to someone you admire and appreciate or donate to a relative’s favorite cause in their name (just be sure the charity is legit).

To All a Good Night

There’s no need to spend to excess during the holidays when there are cheaper alternatives to choose from. When the shopping bug bites, try to relax and savor the small things. Make some apple cider on a cool night and listen to some holiday tunes instead of shopping. If your family insists on a massive meal, focus on cooking one dish and make it a great one. Saving money on a tight budget is easier when you focus on the true joy of the holidays — showing love and kindness to others.

Did you know you can open a dedicated savings account for holiday purchases?



The material presented here is for educational purposes only and is not intended to be used as financial, investment, or legal advice.