It’s that time of year again when we rack up our credit cards trying to find the perfect gifts for our friends and family.
In fact, a recent survey by the National Retail Federation consumers are expected to spend about 4% more than they did last year (for a grand total of about $608 billion) and b) many of them will be relying on credit to make this happen.
This could lead to some major issues and cost you more than it needs to. Which is why I’m going to lay out some ways you can do some holiday gifting without going broke.
Holiday Gifting Without Going Broke Tips:
- While I could go on forever about the perils of consumerism this time of year, I will admit that spending helps the economy. As such I will put my soapbox away (Though I do feel it is my civic duty to say that you should support small business this time of year).
- I’m all for making gifts so that it’s less expensive. However, I also realize that sometimes ain’t nobody got time for that. Some of us also aren’t very crafty and incredibly impatient (okay, maybe that’s just me) so I’m leaving this out from my tips.
- I don’t think credit cards are evil so you won’t hear me saying anything that even remotely suggests it. What you will find are some ways on how to use credit wisely. You can start holiday gifting without going broke if you use your credit cards the way you’re supposed to.
Purchase ahead of time (or as you find things throughout the year).
I start shopping for the holidays months in advance. In fact, there may have been moments where I’ve had presents in my closet for about six months to a year before I can actually give them to the person I bought it for.
This helps you budget and pay for things before December even rolls around. It also allows you to spread it out so you don’t go apeshit on your bank account all at once.
For example, my family loves art. They also love their pets. What do I do? I commission pet portraits. This takes a lot of time to create and get shipped so I budgeted for this months in advance. It’s not a huge sticker shock come December because it’s already been budgeted and paid for.
Bonus points because I choose to support small businesses.
Another example is when I found an awesome glass coffee cup set on sale a couple of months before the holidays. One of my best friends happens to be a complete coffee addict so I thought of him. I bought them and gave them to him for Christmas.
If you’re going to use credit – use it wisely.
So I don’t think credit is the devil. In fact, if used wisely it can open the doors to a lot of cool stuff. And besides, just because you use a credit card doesn’t mean you’re going to go out of control and snowball into thousands of dollars worth of debt.
However, if you’re going to use credit you have to be smart about it. You also have to be diligent about your emotions.
If you are going to use credit here are a few tips:
- DO NOT, I repeat, DO NOT use retail store credit cards to get discounts. There’s a ton of fine print that keeps you from actually saving money. Besides that 20% off a bra at Victoria’s Secret won’t matter if you’re paying that much or more in interest anyway.
- That being said, there are actually good rewards programs out there. Pick a rewards program that actually does get you more bang for your buck. Like cash back or my personal favorite, airline miles. Savings hundreds on a flight is way more cost effective than getting 15% off underwear. Just sayin’ (Of course I value travel and have to do it for my business anyway so it works. It may be different for you.)
- I’m sure this goes without saying but try your best not to go overboard. Easier said than done, I know. Make a shopping list and stick to it. If you find yourself getting tempted, pause and walk away.
- Be aware of your emotions. Our emotions this time of year can really do a number on our wallets. We get excited, we go overboard, we want to get ourselves some stuff too, and before we know it the shiny plastic has a mind of its own. If you are using credit you must be especially aware of your emotions. Simply put, since you’ve got a line of credit you may be more likely to spend without thinking. So do yourself a favor and keep your emotions in check.
- Consider calling up your credit card company and putting a cap on the card. This will force you to stick to your budget.
- Don’t fall for sales psychology. Look, I love a good sale too. But that’s no excuse to buy a bunch of stuff I really didn’t plan on just because “it’s on sale.” You may think you’re saving money but you may actually end up spending more than you planned, therefore not saving any money at all.
Cash in on rewards and gift cards.
If you take a look around you can find rewards points and gift cards that you haven’t used lying around. I, for one, get a bunch of Amazon gift cards gifted to me throughout the year and then I totally forget about them. Come the holidays they come in real handy because they help me pay for gifts. This is really helpful if you are trying to start holiday gifting without going broke.
(P.S. If you do happen to have a bunch of Amazon gift cards lying around you can use them to gift a copy of Make Money Your Honey. It’s perfect for the budding entrepreneur in your life or anyone looking to get their finances in order. It’s also very affordable. You can get your copy here,)
Remember it’s about love, not money.
Don’t give in to the pressure of spending a ton of money on the perfect gift. This time of year is about love, not money.
And by the way, money doesn’t equal love. For some of you that may be a negative money story, you need to deal with this time of year. Maybe the way your parents showed you their affection was by buying you stuff. Or perhaps because you couldn’t afford stuff growing up then you feel like you need to make up for it now. Either way, no amount of money could ever represent the love that you have for someone.
Do you have any tips for holiday gifting without going broke?