Many of us approach holiday budgets the same way we look at those New Year’s resolutions to lose weight. We’re very good about making a promise to ourselves, and we’re able to resist for a few days. Then that plate of cookies starts calling to us, and the resolution is forgotten until the next January.
Just as winning that short-term battle over our weight can pay long-term benefits for our physical health, actually sticking to your holiday budget will pay off in financial health for a long time to come. That’s because most people end up paying all year long for overindulging in holiday spending. That’s especially true if you use credit cards for your holiday shopping.
On the other hand, if you set a modest holiday budget and stick to it, you won’t face all those post-holiday bills. It may sound difficult, but all you really need is some common sense, a little time to plan, and the willingness to see it through.
Start by deciding how much you can really afford this holiday season. Be realistic about what you can spend and be sure to put it in writing or spreadsheet. Try not to compare it to previous years if you can’t afford the same amount but concentrate on more important aspects of the season.
Then make a list of everyone you’re planning to buy for, and decide how much of that total you can spend on each of those people. If you can, identify a gift that falls into the price range for each person. It’s a lot easier to think clearly at home, rather than when you’re surrounded by the hustle and bustle of the stores.
Be careful not to overdo it. Many people think they have to spend a lot of money on family and friends, but smaller, more personal gifts may be far more touching. Or buy several small items and arrange them in a holiday basket.
Choose a time to shop when the stores won’t be as busy, because if you’re not being shoved around, you’ll feel less of an urge to grab the first thing you see. It may even be worth taking a half or full day off work so that you can shop when it’s quiet. Monday and Tuesday mornings are an especially calm time.
Finally, remember that stores are set up to encourage you to spend. Merchandise placed near the front doors or along the checkout lanes is called an “impulse item,” because store owners know that people will be more tempted to buy it right then and there. Resist that temptation, and you’ll thank yourself for months to come.