Enjoying the holiday season is fun, but dealing with the aftermath of overspending isn’t! Find out how you can avoid that!
Gathering around with family and friends, while unwrapping presents, during the holiday season is undeniably enjoyable. However, for many people, the real challenge comes when they have to face their credit card bills afterward. So, let’s discuss about ways you can avoid overspending next time!
Long before the holiday season arrives, consumers start preparing for the expenses. A September survey by NerdWallet revealed that, in 2024, 55% of holiday shoppers felt anxious about the costs associated with the holidays. However, despite this, 32% of them believed it was important to buy gifts and experiences to express their love for family and friends, according to the survey.
“The holidays are hyped 24/7 for weeks before the actual days. This builds a level of almost manic euphoria and gives us permission to ignore a spending plan, achieve instant gratification and worry about the aftershocks later”, explained Carrie Rattle, a financial therapist in New York.
This year, 10% of holiday shoppers considered using their emergency savings to buy gifts, as reported by the survey, which included around 2,000 adults aged 18 and older. Additionally, 9% said they would prioritize gift purchases over paying off debts or other bills.
To avoid overspending during the holiday season, experts recommend planning ahead and setting a spending budget. Taking proactive steps now can prevent repeating the same mistakes next year. So, here’s what you can do:
Plan Ahead and Manage Your Shopping Time
It’s ideal that you start planning for significant purchases, such as holiday gifts, “when you are calm and rational“, Rattle advised. “Before the tide of emotional shopping overtakes you, know what you want to spend“, she added.
This approach allows you to thoughtfully choose gifts and research their costs without feeling pressured. Kristen Euretig, a certified financial planner and founder of Brooklyn Plans, recommended saving for the holidays throughout the year as well.
“You can simply set aside a monthly amount to a dedicated savings account and reserve it for holiday expenses”, Euretig suggested.
Starting early also gives you the chance to take advantage of sales that can happen throughout the year, Euretig advised. Rattle also suggested making a list of desired gifts well in advance and spreading out your purchases to stay within your budget.
“Buy once a week. Bookend your shopping time by having an obligation before shopping, and right after your targeted completion time. When you control your purchasing time you also control browsing”, Rattle noted.
Additionally, pay attention to whether the gifts you purchased before are actually being used by the recipients. This can help you identify what is truly valued by the other and what’s not, Rattle concluded.