Budget-Friendly Holiday Shopping: Six Smart Tips “`

The holiday season brings the year’s busiest shopping period, with consumers anticipating significant spending.

Record-high consumer spending is projected this year, averaging $902 per person on gifts, food, decorations, and other seasonal items—a $25 increase from last year and $16 above the 2019 record. A debt.com survey reveals that many plan to incur debt for holiday shopping.

Experts advise that budget-conscious shopping is achievable with careful planning. Avoiding overspending prevents future financial stress from unnecessary purchases, according to Julia Lily, founder and wealth advisor at Ryerson Financial.

Here are some tips for budget-friendly holiday shopping this year.

Set a budget

While mindful year-round spending is beneficial, budgeting is crucial during the holidays. Lily suggests creating a spending plan to allocate resources effectively, rather than impulsive credit card purchases.

To create a plan, Lily recommends assessing fixed monthly expenses (rent, car payments) and flexible expenses (groceries, entertainment) to identify potential savings. Then, determine your holiday spending allocation.

Make a list

Before shopping, list recipients and necessary items. Similar to grocery shopping, a plan simplifies holiday shopping, says Sarah Paulson, certified financial planner and owner of Valkyrie Financial.

Lists curb impulse buys and associated anxiety, adds Lily. Planning gifts enhances enjoyment and reduces stress.

Shop deals intentionally

Avoid impulse purchases driven by sales. Paulson advises asking, “Would you still buy this if it wasn’t on sale?”

Utilize sales for listed items and explore retailer price-matching services.

Look at your holiday spending patterns

A survey indicates that 28% of credit card users are still paying off last year’s holiday debt. If you overspent last year, Rosario Chacón, certified financial planner and founder of Wealth-Source Financial, suggests reviewing purchases to identify causes of overspending. Analyze whether purchases were necessary or impulsive.

If overspending is a tendency, Chacón recommends discussing planned purchases with a loved one for guidance.

Get creative with gifts

Experts suggest creative gifting—homemade items or experiences. Gifts don’t need to be purchased, notes Lily.

Consider gifting needed everyday items, potentially avoiding future purchases. Focus on needs rather than simply fulfilling gifting obligations.

Instead of gifts for every colleague or friend, consider a Secret Santa exchange.

Reframe expectations

Openly discuss affordability during the holidays. Honest financial conversations reduce pressure to keep up appearances, says Lily.

For young children, emphasize holiday traditions over gifts, suggests Chacón. This helps teach children that the holidays are not solely about consumption.

Remember, the thought counts. Paulson notes that loved ones don’t want you to incur debt for gifts.