How To Shop For Everyone on a Tight Holiday Budget

Laveta Brigham

Close up of woman hands putting down a gift box under a Christmas tree. If you’re one of the millions of Americans who lost work this year due to the coronavirus pandemic, your holiday budget might be tighter than usual. And even if you’re fortunate enough to have held onto […]

Close up of woman hands putting down a gift box under a Christmas tree.
Close up of woman hands putting down a gift box under a Christmas tree.

If you’re one of the millions of Americans who lost work this year due to the coronavirus pandemic, your holiday budget might be tighter than usual. And even if you’re fortunate enough to have held onto your usual earnings, it’s still a good idea to make sure you stick to a budget to ensure the holidays don’t pile on any unnecessary debt.

GOBankingRates spoke to financial experts to get their best tips on getting all of your holiday shopping done on a tight budget. Here’s how to make sure this time of year stays merry instead of turning into a major financial stressor.

Last updated: Nov. 12, 2020

Young woman preparing home budget, using laptop and calculator.
Young woman preparing home budget, using laptop and calculator.

Create a Holiday Shopping Budget That’s Separate From Your Everyday Budget

“Based on your overall, monthly budget, create a separate holiday shopping budget that you can hold yourself accountable for,” said Mike Cocco, an advisor with Equitable Advisors. “Spend only what your budget will allow.”

painting manicured nail with pink and glitter
painting manicured nail with pink and glitter

Cut Back on Other Discretionary Expenses So You Can Dedicate More Funds to Holiday Shopping

If your holiday budget is looking slim, consider cutting back on other discretionary expenses in November and December to give yourself a little more wiggle room.

“Perhaps spend less on take-out, beauty services and household cleaning services now through December to give yourself extra cash for holiday shopping,” said consumer and money-saving expert Andrea Woroch. “Remember to factor in more than just gifts into your overall holiday budget, as you’re likely to spend more on groceries for holiday meals, postage for greeting cards, decor, gift wrap and other seasonal splurges.”

A brother is giving his sister a present on Christmas morning.
A brother is giving his sister a present on Christmas morning.

Set Different Spending Limits for Different People on Your List

Once you know how much your overall budget is, you can figure out how much you want to spend on each individual you will be buying gifts for.

“Your budget may vary for individual friends and family members,” Cocco said. “For example, for your kids, you may spend $50-$75 per child, and $100 for your spouse or partner.”

mom-giving-kid-money
mom-giving-kid-money

Don’t Feel Pressure To Buy Your Kids Super-Pricey Gifts This Year

When it comes to buying gifts for your kids, “set expectations early,” Cocco said. “As we all know, this year has been unprecedented, which means many holiday plans have been derailed. Given the financial uncertainty COVID-19 created, now is a good time to help your kids understand money and become more financially literate with the current economic stressors and conditions. Instead of going into debt over buying the latest cellphone, explain the importance of long-term savings and debt management.”

Focused bearded Caucasian freelancer writing in notebook tasks while sitting in cafeteria.
Focused bearded Caucasian freelancer writing in notebook tasks while sitting in cafeteria.

Plan Out Your Gift Spending Before Making Any Actual Purchases

Thanks to online shopping, you can easily see how much every gift on your holiday shopping list will cost before you make any purchases.

“It’s important to make a list with each item’s cost listed out, so that you know what your overall spend will be and can adjust it to ensure the cost fits within the budget you set,” Cocco said. “It’s easy to keep adding to your shopping cart — especially when online shopping — but a list helps hold you accountable and navigate potential impulse purchases.”

Find Out: What COVID-19 Means for Shopping Malls This Holiday Season

Close up of a young woman buying presents online.
Close up of a young woman buying presents online.

Get a Head Start on Shopping So You Have Time to Comparison Shop

“With more retailers online this year, the holiday shopping season has started early. So get a head start on holiday shopping by starting now,” Cocco said. “Don’t forget to compare prices where you can to ensure you’re getting the best deal.”

smart phone with coupon code.
smart phone with coupon code.

Use Promo Codes and Cash-Back Offers To Save When Online Shopping

“Spending just two minutes searching for a code or cash-back offer can save you up to $20 during the holiday season,” said Sara Skirboll, shopping and trends expert at RetailMeNot. “Using sites like RetailMeNot to find the best deals is always a great strategy. Additionally, you can see which brands might be offering cash-back offers.”

Couple window shopping outdoors in winter city street.
Couple window shopping outdoors in winter city street.

Don’t Enter a Physical Store Without a List

If you plan to do your shopping in-store, bring along your predetermined list and stick to it.

“Map out only the stores you’ll need to visit to check off the items on your shopping list,” Cocco said. “This will help you avoid going into any unnecessary store — as seemingly harmless as window shopping may be — and limit any potentially dangerous impulse purchases.”

Look Out for Special Deals on Social Media

Be the first to know about sales by keeping up with your favorite brands on social media.

“Follow your favorite stores and businesses and keep an eye out for when they post special deals for their followers,” Skirboll said.

Make Photo Gifts
Make Photo Gifts

Remember That More Expensive Gifts Aren’t Necessarily Better Gifts

When it comes to gift-giving, it really is the thought that counts — not the price tag.

“Consider opting for thoughtful gifts that don’t necessarily cost an arm and a leg, such as photo albums or charitable donations,” Cocco said.

Friends are buying Christmas presents.
Friends are buying Christmas presents.

Pool Money for Group Gifts

“Partner up with family members or friends to split the cost on presents for your loved ones,” said Maria Pollina, lead of financial health digital tools at Chase. “Pooling resources can help you both.”

For example, you may want to partner with siblings to buy gifts for your parents or go in with friends to buy a gift for another friend’s child. Doing this eases the financial burden on everyone.

Closeup of broken pink piggybank with bandage on wood.
Closeup of broken pink piggybank with bandage on wood.

Avoid Tapping Into Your Savings To Pay For Gifts

“Your savings should be set aside in case of emergency, and while the holidays are an enjoyable time for all, it’s more important to prepare for an unexpected event, such as a medical bill or loss of income,” Cocco said. “If your holiday shopping requires you to skim off of your savings, you should rework your budget to ensure you don’t have to.”

woman on vacation using smartphone and credit card
woman on vacation using smartphone and credit card

Cash In on Your Credit Card Rewards

“The holidays are also a good time to take a look at your credit card rewards,” Cocco said. “Many credit cards offer cash rewards, which you may consider using for your holiday purchases.”

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