Head to Toe


Holiday Finances

Holidays bring great amounts of cheer and happiness as we pause to appreciate the family and friends who have been so vital to our journey throughout the year.  That being said, the holiday season can also be quite stressful especially for those who are trying to make sure their spending is under control. I’m not advising that you don’t buy gifts or be generous, but I know that it can be overwhelming to look at your gift list and your budget at the same time.  So, here are some tips for making sure you get the most out of the holiday season while not throwing all of your finances out of whack.

Create or Review Your Budget

The first tip is to review or create a budget to determine what exactly you can spend during the holiday season.  This means taking a close look at what money you have available that isn’t going to bills or food or rent. It may be that you cut down on buying your lunch or avoid your morning coffee as a way to boost the extra money you have available for gift giving.  While there is certainly the impulse to splurge on something fancy, make sure you’re not putting yourself in credit card trouble when something less expensive would convey just as much meaning. Credit card debt is so prevalent in today’s world and can be so costly to your financial well-being that resisting the urge to splurge is vital.  Nobody who truly cares about your well-being wants you to damage your credit, so focus on spending money you actually have. If you can find a way to not take money from bills and avoid getting into credit card trouble, you’ll be in a much better place when the new year hits.

Cut Down Your Gift List

This is a time for celebration of your closest friends and family, and while it’s tempting to send everyone you like gifts, it may not be realistic.  While buying presents for close family members and friends is great, there may be second cousins or acquaintances that you can avoid this year. Instead, a nice card or a plate of cookies goes a long way to letting them know that you appreciate having them in your life.  

It’s Not a Competition

You will likely be in a situation where there are those who give more expensive gifts than you, as well as those who give less expensive gifts.  If you did the work and created a feasible budget for the holidays, don’t decide to blow that up because a family member is in a better place financially.  I’m not sure any family member wants to place a financial burden on you just so you can spend more on their presents. This whole season is about appreciating what you have and celebrating with those closest to you, not about competing on who can buy the fanciest new toys.  While new gadgets are great, the things that I’ve remembered most are the personalized gifts or experiences that I’ve gotten from loved ones. This requires a decent amount of thought as you can’t simply go with whatever is popular this holiday season. Take some time and think about what the people you’re buying for actually need, and if there are ways to fill that need without breaking the bank.  Most hobbies or interests aren’t prohibitively expensive, so getting friends and family tools to improve their enjoyment of those hobbies and interests can be cost effective and still make a big impact.

Look Before You Buy

With the holiday season comes sales and the opportunity to spend less on things your family and friends will enjoy.  While sales are great, don’t forget about coupons and online coupon codes. It can be easy to search for coupon codes online, and there are apps and extensions that automatically search for applicable coupon codes.  It’s also pretty easy to find coupons for larger stores and find decent savings on items that would make great gifts. While coupons may not seem like a way to significantly reduce costs, if you’re persistent about finding good coupons you can save enough to make it worthwhile.  

Spending Time

Beyond gifts, one of the best things you can do is spend time with those you care about.  Time spent together is generally more memorable for all involved than what gift you are given.  For those who have family within easy visiting distance, it can be a great way to reduce the amount you spend over the holidays while not missing out on what makes this season so special.   

Charitable Giving

For those who are thriving, it may be important to look at ways to give back with the added bonus of being able to reduce your taxes at the end of the year.  Charitable giving can be a great way to reduce the tax hit for that year by reducing your taxable income, but also a great way to support causes that are truly important to you.  Many charities will allow you to donate in someone else’s name, so you can support causes important to them while still getting the tax deduction for the donation. While donations to your church certainly fall under this category, there are some special regulations for these donations as they can only be deducted as an itemized deduction.  Unfortunately you can’t do itemized deductions and take the standard deduction, so it may be worthwhile to figure out which makes the most sense to your financial situation.

Hopefully these tips give you some ideas on how to get through the holidays without spending more than necessary.  I’d love to hear tips or ideas that you have to make the holidays special but cost efficient. Reach out if you want to share your ideas or get more advice on how to make this holiday season fit with your financial goals.  

holiday finances