Planning Your Holiday Season With Six Smart Money Tips
Before you start planning the holidays, you need to figure out what you’re planning for.
Buying gifts is only one part of what we spend money on during the holidays. What about special clothing, babysitters and taxis, tickets, hostess gifts, donations, gift exchanges, specialty food for meals and treats, baking supplies, winter recreation, travel – the list can get out of hand fast.
To help figure out what you’ve done in past, try this – think about what you and your family like to do. Check photos from last year, last year’s credit card and bank account statements might shed more light on what you did. If you use an electronic calendar to track appointments and events, scroll back a year to see what it might reveal.
Once you have an idea on what the list entails, here are a few ways to manage it:
1. Start to Spread the Cost of Gifts Out Throughout the Year
Some of the hardest people to buy for are those who have it all, but “having it all” means different things for different people. You might have very young children on your gift list, whose playroom rivals a toy store. You might have older folks who want to down-size and don’t need more clutter. Or maybe you’ve got friends and family who really don’t need another “thing” in their life.
When it comes to buying gifts for people who have it all, creativity is king. This is the perfect time to consider alternative gift ideas, many of which don’t have a large up-front cost. For instance:
- With children you could start or contribute to their RESP
- For young people who have a lifetime of expenses ahead of them, they would appreciate contributions to a TFSA
- Older people who want to leave a meaningful legacy to the next generation, contributing to their favourite charity on their behalf might be the right gift
- Other great alternative gifts include subscriptions for online programs (e.g. security, music, favourite apps) or magazines; tickets to events, the movies, recreation spots, concerts, or the theatre
One of the best things with these types of alternative gifts – you can set up monthly contributions at a nominal amount that total what you want to spend annually on the gifts. This takes the weight off holiday gift giving and lets you stick to your annual gift-giving budget.
2. Give the Gift Now, But Get the Boxing Day Price
Does it bother you to shell out the cash for something when you know it will be half price or less after Christmas? There are two things you can do to still give the gift but also get the better price:
First: find out if the store will price match after Christmas so that you can bring your receipt in for a price adjustment. If they will, buy the item, put a reminder into your calendar about when to go back, and give your gift. Be sure to fully understand the retailer’s price matching policies because they vary from store to store (e.g. what the black-out days to come back are, and if you have to bring the item in with the receipt or not).
Second: wrap a picture of the item with a promise to buy it for your friend or family member after Christmas. You might want to pick it up for them yourself, you could give them a gift card to go choose it themselves, or you could head out together. If it’s something they really would like and they’re frugally minded like you are (doesn’t everyone like a good deal?), this can be a win-win for both of you.
3. Shop When Stores are Quiet, and Venture Out Alone
Do you know what the mall’s extended hours are? Most people would need to look it up to be sure. Go during those extended hours and you’ll find the stores much less busy. Another good time is Friday and Saturday evenings because many people are out enjoying some holiday cheer, or during the weekdays while kids are still in school.
If you can, shop alone, smartphone handy to compare prices and use coupons in apps. Line ups are generally short, if there are any at all. Staff aren’t run off their feet and can help you find what you need. You can think about what you’re buying and check your list twice, rather than worry about another shopper picking up the last one of something you need.
Maximize your concentration by eating before you go and packing a bottle of water too.
4. If Shopping with a Credit Card, Know Your Billing Cycle Cut Off Date
Canadian credit cards have an interest free grace period of about 21 days. This is the time from when your bill is cut off to when your payment is due. If you know when your billing cycle ends, buying some items in the current billing period and others in the next cycle, you can spread what you owe out by as much as about 6 weeks. This gives you time to pick up some extra hours at work or cut back on other expenses, while still paying your bill on time.
However, scale back your spending if you won’t be able to pay Christmas and holiday spending off within about 3 to 6 months. If it takes longer than that, interest will add up to 50 percent more to every item you bought. If you can’t pay your bill off, you’re better off to spend less and enjoy the company of your friends and family instead.
5. Buy the Same Gift for More than One Person
It is okay to buy the people on your list who have similar tastes or interests the same gifts. Take advantage of buy-one-get-one deals to save some money. You could vary gifts by choosing different colours, styles, or features. But best of all, you can save yourself shopping time and stress with this strategy. It might even be the cause of some extra fun during the gift opening time! Remember getting the same sleepwear as your sibling? Turn it into a “who wore it best” or “who used it best” show-down for added fun.
6. In-Person or Online, Window Shopping Can Break Your Holiday Budget
This is the season when most retailers break even for the year, so the good deals, specials, and offers are relentless. However, while they are looking out for their bottom lines, you must look out for yours. There are any number of ways to avoid temptation spending, for instance:
- Set up a separate email account for store and loyalty marketing emails and don’t look at the deals unless you plan to shop at the store
- When heading out to shop for gifts, have either a list of what to buy or a dollar value of what you can afford to spend per item. Cross items and people off your list when you’re done.
- When you’ve bought everything on your list, leave the store or website so that you’re not tempted to shop for more than you need.
- For your local retailers, use the “reserve in store” service many websites offer. That gets you in and out fast and you don’t have to go up and down the aisles looking for what you came for (and buying extra along the way).
This holiday season choose to focus on what you have, rather than on what’s missing, and let ‘blessed’ replace your ‘stressed’. There are countless ways to enjoy Christmas and the holiday spirit without burying yourself under mountains of bills. Volunteer your time and talents, draw names for gifts, or organize festive potlucks or cookie exchanges, to name just a few frugal, festive ideas. And don’t worry about what friends or family think of your more affordable choices, they may have wished they’d done the same!
Article details from www.mymoneycoach.ca