Category: Cooperative Extension
Ways to Make Your Holidays Less Financially Stressful
December 04, 2024 Written by: Kelly Sipple, Health & Well-Being Financial Literacy Extension Agent
The holiday season is rapidly approaching, and many people are starting to feel the pressure of the upcoming financial strain. According to an article in Forbes, "7 out of 10 Americans exceed their budgets during the holidays." People get caught up in the excitement of the holidays by attending social events, seeing social media posts, television commercials targeting products marketed to children and adults, and of course, retail stores offering discounts to encourage spending.
But what happens when the holidays end and the new year begins? Bank accounts end up lower than expected, and credit card debt is at an all-time high due to impulse spending during the holiday season. 58% of Americans are stressed about spending too much or not having enough money to spend during the holidays (The Harris Poll on behalf of the American Psychological Association, November 2023). The stress of financial overload is felt year after year during the holidays. Instead of stressing over finances during the holidays this season, be proactive this year by tackling a few tips to reduce that extra holiday stress.
Holiday Financial Tips
1. Prepare a budget throughout the year and make a plan to stick to the budget during the holiday season. Don’t get caught up in the festivities and lose focus on sticking to a budget plan.
2. When budgeting for the year, create a separate savings account that is used only for holiday spending. During the season, do not go over the savings account balance. Label this savings account “Holiday Spending”.
3. Reduce the use of credit card shopping to purchase gifts. If using credit to purchase gifts, only spend the amount in the holiday spending account and pay the credit card bill off as soon as the bill is delivered.
4. Before making any purchases, make a list of who will be receiving a gift and the amount that will be spent on each person. Make sure these gifts are within the spending budget.
5. Be creative about gifting – give baked goods or homemade gifts.
6. Create a menu and designate who will be responsible for what part of the meal during the holiday dinner so it doesn’t fall on just one person’s budget.
7. Take the time and enjoy the holidays by spending quality time with family and friends.
By being proactive and mindful of spending, you can enjoy the holiday season without the added stress of financial strain. Planning ahead and sticking to a budget can help ensure a more financially secure start to the new year.