With the holidays fast approaching, your to-do list is probably growing: the food, the decorations, the gifts! While we are all ready for the festive fun the holidays bring, is your money ready as well?
In 2017, Americans spent an average of $967 on gifts for family and friends. This cost doesn’t include tree trimming, travel or the added expense for holiday meals. It is so easy to overspend this time of year. Below are some tips that I have found to be helpful to save on holiday spending and ideas to put into practice to help prepare for next year.
Tips for this year’s holiday spending
Create a budget for gift giving. Buying for others is fun and the holiday season often brings out our generosity, but without planning ahead it can be easy to go overboard and spend more than you intend. Before you begin shopping, outline exactly who you will buy gifts for and how much you want to spend on each person. I find it helpful to determine what to buy each person and estimate how much the item will be. That way I stick with only purchasing the item I have listed.
Consider combined gifts. Many times buying a combined gift is more cost effective than two separate gifts. Consider a gift a couple will both love. Maybe a new kitchen gadget that will save them time and money.
Shop alone. Did you ever notice that when you shop with someone, you end up looking at additional items that are not on your list? Shopping alone can help you stay on task and stick to your list.
Pay in cash. Research shows that people spend an average of 12-18% more when they use their credit cards vs. cash. When you use cash, you see the ‘value’ which can help keep you motivated to stick to your budget. Also consider that consumer credit counseling agencies see a 25% lift in client visits seeking help in the months of January and February. This is primarily due to overindulging during the holiday season.
‘Tis the season to give. When gift shopping for others, isn’t that usually the time we see things we want for ourselves? Keep your shopping mission in mind. Only look for the items that are on your gift list and stick to your budget.
Prepare NOW for next year’s holiday spending
Consider shopping all year long. Keep an eye out throughout the year for gifts and make the purchase at that time. We do this in my family, especially during summer vacation.
Track holiday spending. It’s easy with online bill pay. You can set up categories to track your spending which allows you to keep track of your holiday spending all year long. If you like to use Quicken or Microsoft Money for money management, it’s easy to upload your monthly statement.
Save now for the holidays. Here are a few ideas to jump start your savings for next year.
Put a designated amount into a savings account each pay. The best way to do this is to set up an automatic transfer. If your pay is directly deposited to your checking account, set up an automatic transfer of a designated amount to a savings account via online banking or stop by your local Univest financial center and we’ll be happy to set this up for you.
One fun way to save is to save incrementally more each week. On week one of the year you save a $1.00 and build from there: week 2, save $2.00, week 3, save $3.00 and so on. At the end of 52 weeks you’ll have $1,378! Completing the transfer via online banking allows you to easily keep track of what week you are on and view your progress.
See $5.00, save $5.00. Anytime you receive a five dollar bill designate it for savings. This approach can help grow your savings quickly while a missing $5.00 likely won’t have too much of an effect on your daily activities.
These are just a few ways to save on your holiday spending and be prepared for next year. At Univest, we’ll work with you to prepare a savings plan that fits your budget and goals. To learn more about the financial solutions we can provide, call us at 877-723-5571 or visit us online at www.univest.net.
Univest Bank and Trust Co. is Member FDIC.