Saving Money During The Holidays (Plus 5 Easy Ways To Save Over The Holidays)

The holiday season is a magical time of year.

They’re also expensive for most people.

Families get together and spend their hard-earned money on gifts, parties, and other festivities.

However, the cost of the holidays doesn’t just extend to those who celebrate them.

Just about everyone feels the pinch of holiday spending this time of year, which is why it can be so difficult to budget for it.

Even if you don’t have much money coming your way over the next few weeks, you can still save money on your holiday shopping by being savvy with your spending patterns throughout the rest of the year.

In this article, we go through how much you should be spending over the holiday season and 5 simple ways for to save during the holidays.

What is The Average Spending at Christmas

A survey was done to find the average holiday spending.

The results were quite eye-opening.

On average, Americans spend almost $1,000 on holiday gifts and deplete their bank accounts.

Many families take on credit card debt so that they can afford these gifts.

How much would you spend on a present for someone you hardly know?

What if that person was your family?

What if it was your best friend?

These things may come to mind when you read about the average holiday spending.

How Much Should You Spend On Christmas Gifts?

You can look at this figure in a few ways.

Your income relative to the average is one way to look at it.

Right now, the national average is $50,000 a year.

You should cut your spending if you make less or spend a bit more if you make a lot more.

Saving For The Holidays

You must save up enough money in advance to purchase whatever item you want.

If you want to shop on Black Friday every year, you must have the funds in your account by that date.

You may also shop at other times if you prefer.

For example, you can start shopping for Christmas gifts in January if you use cash and set them aside for the holidays, as long as you don't spend the money right away.

To spend approximately 500 dollars on gifts for everyone on your list, you may need to reduce your list or find alternative ways to fund your holiday, such as by getting a side gig or searching for sales, or buying second-hand.

5 Budgeting Tips for The Holidays

Here are 5 suggestions to save money during the holidays:

1. Have a Secret Santa

Instead of buying gifts for everyone on Christmas, ask everyone to participate in a secret Santa by submitting names and then drawing names.

You can also pick out things for each person separately and then wrap them.

This is a great way to avoid spending too much money on gifts for people you don’t spend much time with.

You can also exchange gifts if you prefer to do that.

2. Limit It To The Kids

When buying gifts for people with a large family, prioritize buying for the children instead of the adults.

You can save money and spend it better by avoiding one generation.

Kids tend to remember birthdays and holidays much better than their parents.

With a little extra effort, you can make these celebrations memorable for the whole family.

Try setting up a favorite activity like playing catch, going for a walk, or baking cookies.

The adult might be too tired from work or too stressed to enjoy these activities, so instead of focusing on them, invest your energy in the kids.

Even if the parents are not around, your involvement will still help the kids remember the occasion.

3. Draw Names

Like Secret Santa, set up a name draw every year by November 1st.

Gifts are only bought by the name draws and not just for anyone.

Each family member only has to buy one gift, but everyone ends up getting a gift.

This is great for kids who can’t be trusted yet to buy their gifts or for anyone who just wants to keep it a secret from their family.

It doesn’t have to be expensive either.

The best gifts are those that are meaningful, like experiences or tickets to a special event.

4. Set a Gift Budget Maximum for Participants

When you are planning a holiday with your family, ask them to stick to a set budget for gifts.

Even if they do not usually think about it, this helps everyone in the family.

If you are on a budget and you do not know what to get for your family members, consider using gift cards.

This is a wonderful option because it lets everyone know that you are trying to keep costs down.

When you are out shopping for gifts, try to avoid buying things that are attached to a specific occasion.

For example, avoid buying a Christmas gift for a person who has just had their birthday.

If you know your family members do not have anything they really want, try to think of something they would enjoy.

5. Give Time with Coupons

It is excellent to receive store-bought gifts, but for some families, it's simply impossible.

Offer your time and services instead by using coupons and other creative methods.

Sign up to host a dinner or a party for friends or family members.

You can even offer to do the shopping for them.

Offer to take your elderly relatives for a drive or to a nearby park, and help them choose a gift to give to someone new or a project to work on in their home.

It's also a nice way to spend some quality time with family members who may not see anyone else on their own regularly.

These are just a few examples of ways to receive homemade gifts instead of receiving store-bought ones.

There are no limits to how you can receive these gifts, and they can be just as meaningful as any other type of gift.

Holiday Savings Account for Christmas

What is a Christmas Club Account?

A Christmas club account is a short-term financial account (or Christmas savings account) set up by a bank or credit union to encourage consumers to save for the holidays.

Some Christmas club accounts offer the potential to earn interest, depending on the bank or credit union. This can then be used in their holiday shopping.

A few Christmas savings accounts may require you to have a minimum balance.

Some Christmas club accounts offer insurance against the loss of funds, giving the saver peace of mind.

Christmas club accounts may come with a fee or a minimum direct deposit requirement, so be sure to compare accounts to find the best fit for your financial situation.

A Christmas club account may come with monthly maintenance fees.

A Christmas club account should not be confused with a traditional savings account or money market account.

Where Can You Open a Christmas Club Account?

Christmas club accounts are available at banks and credit unions.

You may need to look around for the best financial institution to open a Christmas club account, as the option may not be available at all.

Banks That Offer Christmas Club Accounts

There are a few banks that offer Christmas club accounts. The following are a few:

• Premier Bank

• BankPlus

• Rockhold Bank

• American Bank and Trust

The following are some credit unions that offer Christmas club accounts:

• Pen Air Federal Credit Union

• America's Credit Union

• Founders Federal Credit Union

• Consumers Credit Union

Conclusion

The holidays are a time of year when many people can feel the pinch of holiday spending.

Even though you might not have much to spend, there are still ways to save.

You can save money over the holidays by being savvy with your spending throughout the rest of the year.

Make sure that you aren't going too far over budget during the holidays, and save enough to do so without becoming anxious about it.

Set a budget and stick to it, as well as a maximum gift amount for each family member.

This will allow you to save money while still giving appropriate gifts to everyone.

If you want to save even more money, you can try your hand at a few of the other suggestions listed in this article.

Check out our personal financial planning page for more topics like these.