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According to CNET’s holiday spending survey, most shoppers plan to spend the same amount on holiday shopping this season as they did last year, but about a third are planning to spend less.
Still, it’s easy for spending to go astray, especially during big shopping events. Financial writer and podcaster Miranda Marquit learned that the hard way. During past holidays, she didn’t have a plan for her holiday spending. Instead, she would make purchases when events or sales popped up, which made the holidays even more financially stressful.
Since then, she’s found savings tools and strategies that can help cut costs. Here’s how she’s doing it while minimizing stress and keeping to her budget.
1. Look at last year’s holiday spending
Marquit always starts by reviewing the prior year’s holiday spending. She looks at bank statements to estimate how much she spent. Then, she sets a realistic budget and plan.
Looking at how much you spent last year may be daunting, but it can help you better prepare for how much you plan to spend on gifts, travel and other holiday expenses. It can also help you strategize for the holiday season. For example, if you overspent on holiday decor last year, or have a hefty energy bill from burning Christmas lights for a month, you may set aside more money in advance or think about decorating differently to lower the bill.
2. Start saving any amount
You don’t have to put aside a large amount of money toward your savings. Every contribution adds up when factoring in the costs like gifts, food and wrapping. If you haven’t set aside money for this year, aim to start saving for the holidays as soon as you can. Marquit initially set aside $10 per week to kick-start her holiday fund, but as her income increased, she was able to save $100 per month.
Usually, she doesn’t exceed what’s in her fund. This year, she’s using her holiday savings toward entertainment and gifts.
3. Consider alternative holiday gifting
Sticking to a holiday budget with your loved ones is tough, but Marquit makes it work. In her case, not everyone gets a gift. Her cousins do a gift exchange with a spending limit, but her friends don’t exchange gifts at all. They have a holiday potluck.
Beyond potlucks, Shang Saavedra, a CNET Money expert, shared a few ways to avoid gift guilt by leaning more on your skills and less on your wallet. For example, gifting babysitting or dog-walking coupons is a low-cost, thoughtful way to keep costs low.
3. Earn cash-back rewards
This year, Marquit is leaning on credit card rewards and cash-back apps to increase her holiday budget. Throughout the year, she earns money from Swagbucks by completing tasks like surveys or games. Marquit says those rewards can add up to Amazon gift cards, which she uses to buy presents. For example, she was able to use rewards to purchase an Expedia gift card for her brother and his wife to plan their next trip. She also keeps an eye out for boosted offers throughout the year to redeem rewards at a higher rate.
“Using the rewards I bank throughout the year means I don’t have to dip into my holiday fund, while it continues to grow,” she said.
4. Use a browser extension
Marquit uses browser extensions, like Capital One’s shopping portal, to find savings on the gifts she’s buying. She gets a desktop notification when the site she’s on offers rewards. Sometimes, she’s able to stack rewards for even more holiday savings. However, Marquit advises only choosing one rewards program because the browser extensions won’t always let you claim two rewards for one purchase. She recommends choosing the program that offers the best redemption possible.
There are other shopping browser extensions CNET recommends, including Honey, Offers and RetailMeNot.
Take a different approach to the holidays
Last-minute holiday entertainment and good deals on gifts can easily add to more debt. But there are plenty of ways to celebrate the holidays differently within your budget.
“I think you might be surprised when you start talking to people and you find that many of them are just as tired of overconsumption during the holidays,” says Marquit. “They just want to enjoy the company of loved ones.”
