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24 Tips to Prep for the Holidays on a Budget

The holiday season is upon us, which means so are big old holiday expenses. Worry not - we have your back with ways to save on gifts, travel, food, decor, and more!

Stephanie Colestruck • October 13, 2021

Leaves are falling. The morning air feels crisper. Pumpkin spice lattes are, well, everywhere. This can only mean one thing…The holidays are (almost) here!

Along with all the excitement, many of us feel something else this time of year: financial stress. From flights to buy, meals to prep, gifts to get, and parties to attend, expenses can add up super fast. 

But not this year, dang it! No, this year, you can get ahead of bills with a stellar holiday budget: One that still lets you enjoy all of the joys of the season, without digging you into a massive hole of credit card debt. Let’s do this!

Why a Budget Matters

Let’s set the record straight: According to the National Retail Federation, the average American spent $998 on the holidays in 2020. And the average monthly rent payment in the US is only $784. It’s no wonder holiday spending can feel like a buzzkill!

Enter your shiny new budget: An important part of any financial plan, regardless of the season. Budgets help you track and manage spending, set limits to avoid overspending, and reduce expenses. When it comes to the holidays, setting a firm budget can help you have fun while avoiding those unexpected, eggnog-fueled shopping sprees. (Target, anyone?!)

Setting Your Holiday Budget

So how much extra cash can you realistically afford to spend between now and the end of the year?  To answer this question, make a little list of your:

  • Past spending habits
  • Upcoming plans
  • Unavoidable holiday expenses
  • Current cash flow
  • Opportunities for extra income

From there:

  • Determine what you can afford to spend and what’s the minimum you can get away with spending (zero frills!)
  • Look at how much you can set aside each week (or month) from now through December, and where you might be able to trim your everyday expenses to find extra cash.
  • Work your budget up slowly to allow for some fun purchases, parties, dinners with friends, and even a cute sweater for the office Christmas party. 

Chime Tip: Be sure to make a plan for setting aside those savings, too! For instance, you may want to direct auto-transfers from your checking account into savings every two weeks, so you aren’t tempted to skip saving.

Now, let’s talk about some ways that you can spend less of that budgeted money on the things you do buy.

Saving on Holiday Travel

Traveling to see family and friends might be one of the most important parts of the season… but it can also account for the bulk of  holiday spending! Here are some tips to save:


1. Buy with points

If you have points available — through an airline or hotel loyalty program, rewards credit card, etc. — now is a great time to use them on travel expenses. Not only does this save you from spending out-of-pocket, but you can sometimes get a better rate when buying with points than you would buying with cash. 


2. Buy with a travel rewards credit card

If you have a credit card that offers rewards on travel purchases, use it when booking airline tickets, hotel stays, rental cars, and the like. You may not see the benefit right away, but you’ll earn extra points on those purchases you can use later, effectively lowering your price. 

Some cards also offer trip protection as an automatic benefit, in case you get sick or have to change plans.


3. Shop through a rewards portal

Many credit cards and loyalty programs offer online travel portals, where you can shop for airfare, hotel rates, car rentals, and even cruises. By booking your travel through these portals, you may be able to access discount rates.


4. Book through a discount site

If it’s good enough for William Shatner, it’s good enough for you. Booking travel through a discount site (such as Priceline, Orbitz, or Kayak) can score you some serious discounts. Plus, many of these sites offer rewards if you sign up for an account, so you’ll save money on your next booking.

Note: Certain travel bookings may have no-cancellation policies. If you need to make itinerary changes, there may be fees involved after booking through a third-party platform!


5. Use up credit card travel benefits

Do you have a credit card that offers an annual travel credit? If so, now’s the time to use it or lose it!

Why? Certain cards may credit your account for a certain dollar amount each year, as long as you spend it on eligible travel. If you have one of these cards, make sure you have maxed out your benefit before the year ends.


6. Travel on off-peak days

Do you know what the most expensive day to fly is around Christmastime? December 26. Unfortunately, it’s also the day that many people need to hop on a plan to either get back home or visit other family members before the break ends.

By choosing off-peak days for your travel, you can save hundreds of dollars. Most airlines have fare calendar tools, which will let you see when the lowest-priced flights are scheduled. If possible, use this to plan your trip(s).


7. Take advantage of standby offers

Not in a huge time crunch? Consider taking your airline’s offer if they ask passengers to volunteer for a later flight. By waiting just a couple of hours more, you could earn an airline voucher worth hundreds of dollars (which you can use for the flight home or a future trip!).


8. Consider not flying

Taking to the skies is usually the most expensive travel method. If you’re able, though, consider an alternate transportation type.

For example, spend an extra day road-tripping to see loved ones. You’ll save on flights and a rental car at your destination, and see some fun places along the way. You might even consider hopping on an Amtrak route, where you can nap as the countryside passes you by.

Chime Tip: Travel often makes up the majority of holiday spending costs, but can also be one of the easiest expenses to trim down. By utilizing credit card points programs, third-party discount booking platforms (like Orbitz and Priceline), and any existing rewards first, you can easily save hundreds.

Saving on Holiday Gifts

Giving gifts may be one of the biggest joys of the holiday season, but if you’re not careful, it can wreak havoc on your budget! Let’s not let that happen.


1. Go with homemade

Look, everyone loves a homemade gift. Moms, grandparents, siblings, friends… it doesn’t matter. There’s just something special about receiving a gift that you know someone poured their time and love into.

Search online for homemade gift ideas, and combine these with any skills you already have. Woodworking, crocheting, planting, sewing, building, writing — your talents can make for some awesome homemade gifts.


2. Shop secondhand

Secondhand doesn’t have to mean old or damaged or outdated. In fact, secondhand can be a great way to snag unique, vintage, or valuable gifts at a discounted price. And in some cases, you can even find brand new items being sold at secondhand stores!


3. Use a cashback app

Whatever you buy and wherever you buy, try to use a cashback app first. These apps reward you for buying the things you were going to buy anyway, as long as you do it by going through their platform. You can earn anywhere from 1% to 20% back in many cases.


4. Earn rewards

Again: if you’re going to spend anyway, get rewarded for it!

Credit card, store brand, and other loyalty programs offer you the chance to earn valuable rewards on your purchases. You can then trade these rewards in for discounts, merchandise, or even cash in many cases.


5. Suggest a gift exchange instead

If you have a big family or friend group, buying a gift for everyone can be overwhelming. Instead, broach the idea of a gift exchange to everyone instead.

Gift exchanges can take on many forms, but generally involve each person buying just one gift. 


6. Sign up for store loyalty programs

Grocery stores, department stores, beauty stores… almost everyone has a loyalty program these days. Sometimes, these programs are pretty lucrative, though, earning you rewards on the money you were going to spend anyway.

Anytime you buy, ask about loyalty programs and their terms. You could earn a percentage of your purchases back, without doing anything extra.


7. Buy discounted gift cards

Know where you plan to shop? Buy some discounted gift cards online and save from the start.

Discounted gift card platforms will sell store and brand gift cards at a reduced price; for instance, you might be able to get a $50 Target card for just $40. If you then go and spend $50 at Target, you’re actually only $40 out-of-pocket… saving you $10 from the get-go.

Chime Tip: Platforms like Pinterest can help you find ideas and instructions for homemade or upcycled gifts that are within your skill level. When you do shop, use a site like Rakuten to earn cashback at eligible stores.

Saving on Holiday Food

If your family is anything like mine, it can feel like the entire holiday season is centered around food! While yummy, these costs can add up fast, whether you’re enjoying meals out, hosting, or just bringing treats to a gathering. Here are some ways to save on those inevitable costs:


1. Buy in bulk

One of the easiest ways to feed a crowd for less is to buy in bulk, which might mean shopping at a warehouse store like Costco or BJ’s. 

If you don’t normally shop at these stores, don’t fret: bulk shopping doesn’t just mean 45-pound bags of flour and rice. In fact, these days you can even buy organic items — such as fruit and meats — at a discount price.


2. Plan a menu

By planning meals and menus well in advance, you have a chance to prepare and even shop for the lowest possible prices. Determine exactly what you’ll need, whether it’s Christmas dinner or a friends-giving supper, and then browse through local store circulars to find the best deals.


3. Eat in

It can be tempting to grab meals while you’re out Christmas shopping, or meet friends for happy hours over the holiday season. While there’s nothing wrong with doing so, these restaurant meals can really do a number on your budget.

Instead, plan a cocktail hour at home and invite friends over. Schedule a Saturday brunch potluck and have everyone bring a dish. Or just prep meals ahead of time before you go run errands, so you don’t have to pay for lunch at a restaurant.


4. Use gift card-buying platforms

As mentioned above, discount gift cards can be a great way to save money. Know that you’ll be dining at a particular restaurant or chain? See if you can snag cards from a discount platform to save money on your inevitable meals out.


5. Look into local prix fixe specials

Around the holiday season, many restaurants offer specials or prix fixe (fixed) menus. If you can snag a seat, these can save you money while allowing you to dine at exciting — and often upscale — restaurants with friends and family.


6. Plan a potluck

Rather than taking on the full burden of a big group meal yourself, suggest a potluck. Each of your attendees can bring their best dish, which takes some of the pressure (and cost!) off of you while allowing everyone to introduce their favorite foods to others.=

Chime Tip: Between regular meals, special group events, and meeting up with friends, food can cost you a lot over the holidays. There are many ways to cut costs, though, either by utilizing discount offers and gift cards, buying in bulk, or even spreading the responsibility amongst your group.

Saving on Holiday Decor

Halloween, Thanksgiving, Hanukkah, Christmas, New Year’s Eve… this season is just a constant revolving door of themes and decor. If you’re going to stay in the spirit of the season, you’ll want to do so with your budget in mind.


1. Host an ornament party

Similar to a cookie party or any other potluck, an ornament party can help you decorate your space for less. Invite friends and neighbors over, telling everyone to choose an ornament and bring X number of the same thing. At the party, all attendees will receive one of each ornament, going home with a variety of pieces and styles for the season.

You can also turn an ornament party into a handmade event. Have each attendee choose their homemade ornament design, and bring enough supplies for everyone to make one. 


2. Look for secondhand items

As folks begin pulling their holiday decor bins out of the attic, they may decide that something isn’t their style anymore or doesn’t fit their new home. This is your chance to snag awesome secondhand pieces at a budget-friendly price.

Browse Craigslist or Facebook marketplace for used decor items, or search through your local thrift store for treasures. 


3. Use the real stuff

Decorating with things you find in nature can be an affordable way to stay trendy and prepare your space for the holidays. Browse sites like Pinterest to get crafty ideas, and then get to hunting around town. You can use everything from sticks to pinecones, fir branches, seasonal flowers, and even leaves in your projects.

Chime Pro Tip: Decorations don’t have to be new or even artificial to look great. Consider using a mix of handmade, traded, and even second-hand decor to prep your home for the season.

In summary: The holidays can be an expensive time of year! With the right budget, though, you can reduce your costs and still squeeze every bit of joy out of the end of the year. And in January, you can even start budgeting and saving early for next holiday season!

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