Whether you are ready or not, the 2021 holiday season is fast approaching. This time of year is joyful for many people, but can bring added stress as well. This is especially true when you are unsure of how to budget for the holidays.
Holiday budgeting does not have to be a chore. In fact, if you make and stick to a budget, you may be able to eliminate some of that holiday stress! To help, we have assembled some tips and tricks on how to create a holiday budget plan that works for you.
How to Budget for the Holidays
1. Make a Budget
The Consumer Financial Protection Bureau reminds us that it is important to create a budget well before the holiday shopping starts. Consider your regular monthly expenses such as:
- Rent/mortgage
- Utilities such as gas, electric, water, phone plan, and wifi
- Food/drink
- Transportation
- Extras such as subscription services, streaming services, gym memberships, etc.
Be thorough with your monthly expenses, and try not to leave anything out. Follow this by calculating your income. Compare the two and see how much you have left over. If you have some wiggle room, save a little bit and allot the rest for holiday gifts.
2. Plan Holiday Spending By Person
Not everyone will get the same caliber of gift for the holidays. Holiday budgeting means knowing who you are buying gifts for, and how much you can spend on each person. Essentially, make a list and check it twice.
3. Plan Your Holiday Spending Methods
Decide how you will purchase gifts. Some people prefer to use debit or cash, while others plan to use their credit card or afterpay options. Different options work for different families, so decide which is best for you.
Don’t forget to consider that:
- Credit cards often have reward points or cash back options.
- Credit and debit cards leave an electronic trace in the event that you need to return or exchange an item.
- It is easier to stick to your budget with cash.
4. Take Advantage Of Online Shopping
When you shop online, you can compare prices to find the best deal for the product you want to buy. With Black Friday sales, free shipping codes, and price match options, you can maximize your holiday spending budget.
Holiday Spending Statistics You Should Know
- In 2020, 73% of holiday shoppers bought gifts online (American Research Group).
- In 2019, the average holiday spending budget was $942. This is the highest it has ever been (Gallup).
- Black Friday shopping has dropped in popularity in recent years. While 59% of consumers in 2015 planned to do most of their holiday shopping on Black Friday, only 36% said the same in 2020. This is not just because of the pandemic—the rate has been similarly low since 2017 (Statista).
- 66% of shoppers in 2020 said that they would wait for something to go on sale, rather than paying full price. Another 20% said it depends on the gift, while only 14% planned to pay full price (American Research Group).
Trajan Wealth Is Here For You This season
If you are ready to build your wealth and assemble a reliable financial plan, Trajan Wealth is here to help. We have comprehensive financial services that can benefit anyone, at any time of year. Learn what makes us unique. And when you’re ready, reach out to see how we can help you feel confident about where you are financially, as well as where you’re headed.
