How to create a holiday shopping budget
Holiday shoppers may be looking at pricier gifts this season with inflation remaining high. You can take steps to alleviate the financial toll of the holiday season by making a holiday shopping budget.
According to recent data from Deloitte, retail sales are set to increase due to higher prices. Deloitte predicts that holiday sales will total $1.45 to $1.47 trillion this season. This is a 4% to 6% increase from the 2021 holiday season.
You’re not alone if you’re worried about the costs of gifts this year. The vast majority of consumers participating in the International Council of Shopping Centers’ Annual Holiday Shopping Intentions survey said inflation would impact their holiday purchases. Consumers also said inflation was a significant reason why they were planning to spend more this season.
4 holiday shopping budget tips.
Before you start shopping for the holidays, don’t forget these simple budgeting tips.
1. Review your finances.
Start by gathering all your finances and taking a close look at your monthly spending, savings, and income statements. Looking back at last year’s holiday expenses is also a good idea. Knowing how much you spent last year can give you some idea of what you’ll need to allocate toward a holiday shopping budget this year.
Once you’ve reviewed your finances, you’ll have a better idea of how much you can spend on gifts and other holiday expenses this year.
2. Make a list of expected gifts and holiday expenses.
Next, you’ll want to create a detailed gift list, including all the friends and loved ones you need to buy gifts for. Then pick one or two gift ideas and estimate a price range for each person on your list.
You’ll also want to include in your list other holiday expenses, including office gift exchanges, gift wrap, shipping costs, holiday food, festive outfits, travel, and charitable donations.
3. Create a strict holiday shopping budget.
Now that you’ve reviewed your finances and made a detailed shopping list, you’re ready to create your holiday shopping budget.
Look at how much money you have left to spend during this holiday season and decide your spending limit. It’s important to keep your budget realistic, so you don’t overspend.
Refer back to your gift and holiday expense list you’ve already created. Divide your budget according to the different spending categories you’ll have this holiday season. Then, assign a specific amount for each gift, as well as for travel, holiday party, and other expenses.
4. Shop smart.
Make your dollars go further by shopping strategically, including shopping the sales and using reward programs.
Consider shopping pre-holiday sales like Black Friday, Cyber Monday, and Small Business Saturday to save on gifts. You can also keep an eye on retailers for specific deals or coupons.
You can also use your credit card or rewards card while holiday shopping to take advantage of rewards and cash back.
Stick to your holiday shopping budget and enjoy the holidays.
If you’re concerned about the price of gifts this year, a holiday shopping budget can help you enjoy your holidays worry-free.