Save at Holiday Time

By making smart choices, you can have a joyful season without overspending
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Holly bedecks the door, the air is brisk and the credit-card slips are beginning to fly. But beware: Amid the holiday hubbub it’s easy to spend too much. Fortunately, you needn’t be a Scrooge to make the season walletfriendly. Just heed seven practical tips:

1 Create a budget.

“Decide how much you can afford to spend for the holiday season, whether it’s $10,000 or $100,” says Michael Maglio, a financial consultant with Investment Services at Atlantic Stewardship Bank in Wayne and an independent financial planner with LDL Financial of Clifton.. “Write down all the things you’d like to include—gifts, cards and postage, decorations, charitable contributions, entertaining and holiday travel or clothing purchases. Make realistic cost estimates for each category, including gifts for each family member. Then, if necessary, whittle down your list or your allocated amounts until the total fits your desired figure. Leave a small margin for the unexpected. Then stick with that budget.”

2 Make mid-course corrections.

Even when the season is well under way, you can take a fresh look and trim spending if it runs too high. Does Uncle Arthur really need a silk tie and a bottle of Chivas? You could give the tie and save the Scotch for a party. And what about that pricey group excursion to a football game—could a well-supplied bash in front of your TV at game time create the same convivial spirit with less red ink?

3 Know your shopping style.

You may read savings recommendations that conflict, like “Set cash aside and stop when it runs out” and “Shop online to earn rewards points.” But the best advice is to know your shopping pattern and what helps you limit spending. For some of us, the computer is a danger zone—it’s easy to go overboard clicking those keys, whereas if we tote heavy bags home from the mall we feel what we’ve spent. On the other hand, says Maglio, “If you shop early online, you can often get good prices and free shipping, or at least a bargain rate.” You may also score bargains or coupons by “liking” merchants on Facebook, visiting sites such as fatwallet.com and ebates.com or checking for the “Deal of the Day” on newegg.com or amazon.com.

4 Be creative.

Does a family member excel in an art or craft? A handmade gift or card is more personal than a purchased gift as well as more economical. Strings of popcorn for the tree can be cheaper than store-bought decorations, and are fun to make together and better conversation-starters for guests. And instead of a costly coffee-table book, might neighbors and co-workers be just as happy with a fresh batch from your family’s favorite cookie recipe?

5 Give up the giving “arms race.”

Christmas, Hanukkah and Kwanzaa aren’t about keeping up with the Joneses—even if you’re a Jones. If your tribe competes in gift-giving generosity, declare a truce, and agree to set spending sights lower or establish a “secret Santa” plan rather than buying for everyone. Even if you’re doing fine financially, there may be an unemployed or underemployed relative who’d appreciate a mutual easing of gift expectations.

6 Dine out judiciously.

Restaurant tabs have a way of soaring, especially in groups of thirsty, impulse-driven holiday revelers. Plan ahead when you eat out, doing online research to pick a good place, and consider having guests over for pre-dinner drinks instead of running up a cocktail bill from the bar.

7 Start now to save for next year.

While holidays are top of mind, why not begin making good decisions for 2013’s festive season? Now, for example, is the time to sign up if your bank or credit union offers a Holiday Club or Christmas Club, to which you can direct automatic payroll deductions throughout the year. “Such a program can be a useful savings tool,” says Maglio, “especially for people who don’t have enough flexibility in their income stream to finance holiday spending all at once without tapping credit.”

 

Related Read: Charitable Giving- Funds to Feel Good About

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