5 financial tips for the holidays

Sure, it’s the thought that counts when it comes to gift-giving, but that doesn’t stop some people from overdoing it—and overspending—during the holidays.

Surrounded by holiday decorations, music, and fellow zealous shoppers, even normally cautious spenders can end up creating financial problems for themselves. And if you’re a big spender anyway, you may feel like it’s a lost cause to learn how to budget your money now, but that’s simply not the case.

Indeed, now is the perfect time for all consumers to follow some simple budgeting tips that could save some future financial strain, especially during the first few months of next year. Read on for advice on how to manage your money during the holidays and beyond.

1. Make a list and check it twice

Follow Santa’s lead and make a list of the people you will be getting gifts for along with thoughts for their presents—and include a price range you want to spend for each person. Budgeting your holiday list ahead of time will only take a few minutes, but it can end up saving you lots of cash in the long run. You do have to stick to the budget, though, and avoid those last-minute impulse buys in checkout lines.

If your list is looking too long and making you stretch your budget, consider agreeing not to exchange gifts with certain people or arranging with your family or friends to exchange names so that each person only buys a gift for one other person.

2. Shop early but not necessarily often

Keeping an eye out for sales is one of the best ways to save money on holiday shopping—and sales tend to happen earlier in the season rather than later. With plenty of time to spare, you can also research the items on your list and cross-check prices between stores and online retailers. Even better, you will also have left yourself ample time for shipping.

3. Get creative

Handmade gifts ranging from baked goods to knitted scarves have always been in fashion, so if you have a creative streak, don’t be afraid to utilize it—and save money—in your gift-giving.

That said, if you don’t happen to have any such skills or the desire to make gifts, you could also consider donating to the person’s favorite charity in their name or offering up your time to them whether it’s to dog sit while they’re on vacation or help them move into a new place. Getting creative with your gifts doesn't have to mean pulling out the glitter!

4. Pay in cash, check, or debit—not credit

When it’s time to pay for your purchases, cash, check, or debit is best as you will be sure you’re only spending money you actually have. Moreover, you won’t have to face hefty bills to begin the new year.

If you must use a credit card, though, try to use one that has reward points so you can get something more out of the exchange and help stay within your holiday shopping budget.

5. Pay off those bills

While considering your holiday budget, you should also think about how and when you will be able to pay off any purchases made on credit.

Of course you should always pay off your credit card bills as early as possible, preferably at the end of the next billing cycle so you aren’t charged any interest. If you can’t manage that, however, you should figure out how long it will be before the interest rate on your carried balance ends up canceling out or greatly diminishing any rewards you have gotten.

Hopefully, the preceding financial tips for how to budget your money during the holiday season will not only help you this year but also get you ready to think about next year’s spending, too. Putting aside a little cash each month starting in January is another way to make sure you’re budgeting your shopping money wisely throughout the year leading up to the next holiday season.