We have all been facing the challenges of an economy that is unstable. A slow improvement is predicted in 2012, but complete recovery is still very fragile. People are finding ways to save money and spend more carefully, especially during the Christmas season, a time where families and friends look forward to gathering for festive celebrations and exchanging gifts.
Studies indicate that a family’s typical Christmas gift budget in America makes up about 1.3% of their annual spending. That total doesn’t include decorations, wrapping paper, parties or family activities. In the past, some families have spent $1,000 or more on the season. However, shoppers everywhere are now finding ways to save and still have a wonderful time with their family and friends.
Christmas Savings: The hot tips
Here are some tips to help you save money and shop smart this coming Christmas. Some of the ideas are new, but some are old-fashioned and are due for a sweet revival.
1. First of all review last year’s budget to see where it can be improved. Decide on a total amount of money that is reasonable for you to spend this year and then break it down into categories. You may want to spend less on cards and decorations and more on gifts. Or you may want to spend less on gifts and more on activities that the family can share. Divide the total amount of all categories into 12. That is the amount, moving forward that you will need to save on a monthly basis.
2. Shop early. We all know that this is a good practice when we are trying to make Christmas Savings, but do we actually do it? Prices tend to go up the closer we get to the Christmas season. Try to find sales where you buy-one-get-one-free (BOGOF) and look for bargains all year round. Many stores have sales throughout the year to boost profit margins. If you can do all of your Christmas shopping by November, you can avoid stress, will not overspend and, just as importantly, you will be relaxed knowing that you have enough precious time to enjoy the beautiful season.
3. Take advantage of cash back sites. If you prefer to shop online, find sites that share some of the commission with you as you make your purchases, and don’t forget to compare prices or find online sites that don’t charge shipping costs.
4. Consider opening a Christmas savings account that may be available through your credit union or bank. A certain amount of money will be automatically withdrawn from your checking account to put aside for the holiday season. Since you don’t see the money, you will not spend it! The only disadvantage is the low interest rate. You can get a higher interest rate in a money market account, but you need to have the self-discipline to leave it! Online savings accounts also offer higher interest rates than Christmas accounts.
5. Save your change. Throughout the year, save the loose change you find in your wallets, pockets and purses. It is a great way to save money. Have a large jar and make it a family project. (This is my personal favorite)
6. When you balance your checkbook round down your deposits (or you can round up your check amounts to the next dollar or five dollars). Either way, you forget about this money. Then be sure to move it into your savings account at the end of the month.
6. Review your Christmas card list. Sometimes we send cards to people we have not otherwise had contact with in years. They may be relieved to be no longer on your list. Or send to half of your friends one year and alternate with the other half of your friends another year. Consider photo emails or phone calls instead, or send postcards (they are less expensive and require less postage). If you go totally paperless, friends will understand. You will help both the environment and your budget! If cards are important to you, remember that Christmas cards go on sale in December. Or purchase cards after the holidays to use next year.
7. Wrapping paper can be another drain on your budget. If you choose small gifts, you will need less paper to wrap them. Think about other ways to wrap…use reams of packing paper that you can cut up and stencil. Tissue paper can be used for wrapping and is much less expensive. Use a simple white with a small red bow. Save wrapping paper and greeting cards throughout the year and make your own gift tags from the small pieces.
8. Keep decorations simple. Use natural sources like pinecones and acorns. Bring back the tradition of stringing popcorn with cranberries interspersed. An old fashioned Christmas brings everyone together in very special ways.
9. Consider a small tree rather than a large one. And if you are a young couple just starting Christmas traditions, collect ornaments gradually. Buy just a few special ornaments each year and decorate the rest of the tree with lights, bows, and cranberry strings. Make paper chain garlands and write wishes and messages of love on the paper links.
10. When cooking for the holidays, make as many casseroles as you can. They feed more people, and you can use store brands as the ingredients. Suggest more potluck dinners where the hostess provides the main entrée and a clean house and the guests provide sides, appetizers, beverages and dessert.
11. Families like to do things together during the holidays. Skip going to the movies and have a movie night at home with a rental video. It’s hard to find a video that everyone likes, but take turns choosing…youngest goes first! Or have a game night. Exchange board games with a neighbor for something new to offer your family.
12. Gather your family and friends and go caroling. We all tend to forget that it’s the simple activities that bring us close and bring lasting memories.
13. Start a tradition where, on Christmas Eve, write down what you think is special about each member of your family and put them into small envelopes for them to open.
14. Use the proceeds from a spring garage sale to add to your Christmas Savings fund.
15. When you are thinking about saving money at Christmas, talk to your extended family to see if they would consider one of the following: buy gifts only for children not adults; draw names and buy for only one person; set price limits.
Above all, Christmas is a season of love. It is a time of bringing our families and friends close to us. It doesn’t have to be expensive. If we can just learn to restrain ourselves from overspending at Christmas, just think how much easier it will be to start a life-long habit of responsible spending!