5 Ways to Improve the Way You Save Money Before Christmas
It’s the most joyful time of the year, but after months of higher food and energy costs, you might be experiencing a bit more anxiety than usual about Christmas and festive expenditures in general. With one in five parents anticipating debt as a result of Christmas gift-giving, it’s encouraging to know that there are methods to save money without sacrificing the holiday spirit. Read on for our best advice on how to celebrate Christmas and the New Year without feeling the pinch in your bank account.
Make a gift list ahead of time
Identify your budget and how much you can spend on each individual on your gift-giving list. You should include unforeseen costs like buying food for a holiday meal and any planned trip. From now until November, that’s how much you’ll put away.
For what reason is the month of November? This buys you a few months to start a savings account and prepare for the festive season. If you haven’t gotten your hands on your planned gifts, now is a wonderful time to do so, as this is often when sale season begins and you can discover some excellent bargains. Spending less is always preferable, but overspending should strictly be avoided if you want to keep your finances in order.
Because unexpected costs are inevitable, it’s a good idea to set aside more money than you plan to spend. Something you need to buy, like a gift, might slip your mind, or the final cost turns out to be higher than you anticipated.
Open a special savings account for Christmas
Once you know how much you want to put away for the holidays, you can figure out the most effective way to save that money. Some people set up “sinking funds” in advance of the holiday shopping season so that they are better prepared financially.
You can achieve this by opening a new savings account and reserving funds for holiday or Christmas spending. Automating your deposits is another viable option to consider. You can also start saving in a piggy bank.
You shouldn’t be able to simply move money in and out of this account; otherwise, you can end up squandering the money you were planning to save for the holidays. When the time comes to withdraw the sinking fund money, you can buy gifts without guilt because it was always your plan all along.
Build a Christmas saving plan into your existing budget
Now that you know how much money you’ll need to put aside for the holidays, you can make plans accordingly. To determine how much time you have to save up, you can divide the total amount you need to buy your gifts by the number of weeks between now and Christmas.
You can use this to plan how much money to put away each week for your presents. The total of these weekly contributions can then be used to establish a suitable biweekly or monthly savings target.
Plan your big Christmas shop well ahead of time
The shopping season officially starts in November. It’s also a period when it’s easy to get distracted by flashy commercials. Having a strategy, though, makes it much simpler to stay the course. Buy presents early and conveniently online.
If you must shop, make sure you have adequate time to do it. Plan out the days you will go shopping, the stores you will visit, and the items you will purchase.
Also, leave the credit cards at home and utilise only the cash you’ve set up for this trip. Keep in mind that the goal is to stay completely debt-free during the holiday season.
Keep your motivation up
You should, as always, look for places in your budget where you may save money. It’s a good idea to start thinking about what low-cost or free things your family might enjoy doing together this summer now that school is out.
In the summer, libraries regularly host fun and educational events for patrons of all ages. Single people may do less travelling or discover more free activities to enjoy. Depending on your location and the activities you enjoy, summer can be a very inexpensive time of year or a budget-friendly experience.
You’ll need to maintain focus and dedication to the task at hand if you want to see your strategy through to fruition. If you want to stay on track with your savings goals and provide mutual support, finding a savings partner (also known as an accountability partner) is a smart move.
Plan weekly check-ins with a friend or family member who might be interested in saving with you for the holidays.
Final Thoughts
People can spend an entire year making payments towards their credit card debt, only to fall back into the hole the following Christmas season.
It doesn’t help that credit card firms launch seasonal (and sometimes post-seasonal) advertising campaigns as an incentive, they may provide promotional rates of 0% interest (for a limited time, of course).
Make this your best Christmas financially by using the tips in this article to save cleverly and avoid the trap of holiday debt.
Frequently Asked Questions
When should I start saving for Christmas?
It’s a good idea to start saving for Christmas as soon as possible, as this will give you more financial leeway and an appropriate amount of time to plan for the holiday season.
How do I set up a Christmas budget ahead of time?
It’s a good idea to start by creating a list of all the people for whom you will need to purchase gifts and the type of gifts you want to buy for them. This will give you an idea of the type of financial outlay you can expect.
Should I use my credit card over Christmas?
Many people fall into a debt-trap over the Christmas season which they spend the rest of the year trying to pay off. It’s better to save for your Christmas budget and pay for your holiday goods ahead of time to avoid going into debt.