7 Money Saving Tips for Smart Holiday Spending

While the holidays are expected to be one of the happiest times of the year, we understand that they can also bring along feelings of anxiety when preparing for holiday spending. Luckily, there are many ways to budget and save money for holiday shopping. Here are seven tips for saving money this holiday season.

1. Have a plan for your holiday spending

The key to saving money is to start with a plan that works for you. In terms of holiday shopping, start by making a list of what you want to buy and how much you can afford to spend. You can do this by writing down everyone you plan to buy for and setting realistic expectations for a gift amount. For example, if you have two siblings, it’s realistic to budget $50 to spend on each one. Don’t forget, just winging it and sticking with the “I’ll know when I see it” mindset is not a plan. Without a price limit, it will be hard to budget for holiday shopping.

Many people start to save for the holidays early on to give themselves an extra cushion of money when buying gifts. This is also an excellent way to save small amounts of money early on that will add up quickly for the holiday season. You can start by saving as little as $20 a week. Any extra money you save can be used to take some of the pressure off of your holiday spending budget and allow breathing room when you need it. For details about how to create a budget, visit our website.

2. Organize a gift exchange to help guide your holiday shopping

If you have a large family or friend group, holiday shopping can quickly become costly, especially when you have to purchase a gift for every person. However, arranging a holiday gift exchange is a great way to alleviate some of the pressure of gift-giving. Gift exchanges can have any format you want – the most popular is Secret Santa .

Organizing a gift exchange is one way to ensure that everyone gets just one gift, saving you money and still allowing you to have an exciting gift-giving experience. Many gift exchanges also have spending limits, removing the pressure of feeling like you need to budget for expensive gifts.

3. Save money by reward stacking with apps and credit cards

Reward stacking is when you combine several shopping rewards programs to maximize the discounts, points and cash back you receive on a purchase. For example, holiday shopping with a credit card that allows you to earn cash back is like being rewarded for holiday spending. You will be making money every time you spend money.

Rewards stacking doesn’t have to be just through using credit cards. There are many reward shopping services that will help you save money and earn as much cash back as possible. One example of a reward service is Rakuten , a browser extension that is easy to use and that hundreds of retailers participate in. From time to time, the cash-back percentage for different retailers may temporarily increase or even double, which allows you to earn and save money for items you were going to purchase anyway.

When it comes to credit cards, many give cash rewards on eligible purchases with no limit to how much cash back you can earn. With the ValleyStar Horizon Rewards Visa card, you earn rewards points for every dollar you spend. Plus, get 5,000 bonus points on your first purchase transaction. Points are redeemable for merchandise, travel, gift cards, cash and more. Rewards cards are great to utilize for holiday spending and increased savings.

4. Set price alerts to find holiday deals

Setting price alerts is an excellent tactic if you plan to do your holiday shopping online. One of the easiest ways to save money and make sure you’re not overpaying is to set up an alert, so you know when there’s a price drop. Many different apps and browser extensions can alert you when online products you’re shopping for have lower prices. Price alerts can come in handy if you have specific gifts in mind but don’t have time to patrol product pages for holiday deals manually.

5. Use buy now, pay later services to help with money management

If credit cards aren’t in your holiday spending plan this season, another option is buy now, pay later (BNPL) services. BNPL is a type of short-term financing that allows consumers to make purchases and pay for them at a future date. BNPL is offered as a method of online checkout for most major retailers. Examples of BNPL services include Affirm, Afterpay and Klarna.

The most common BNLP structure is four interest-free payments over six weeks, but sometimes these plans last longer and may or may not include interest. For example, Affirm has a partnership with Peloton that allows customers to avoid interest for up to 12 months, while more extended payment plans carry a 14.99 percent APR (annual percentage rate). If you’re planning to use BNPL for holiday shopping or just to stretch your budget, be sure to evaluate the specific terms you’re offered. BNPL interest rates can vary widely.

6. Take advantage of savings every day, not just on Black Friday and Cyber Monday

Each year, shoppers eagerly wait for Black Friday and Cyber Monday to score the best holiday deals of the season. However, the best way to take advantage of savings is to plan ahead, so you know exactly what kind of products you’re looking for. Chances are you started hearing about “doorbuster” deals in October, but studies have shown there isn’t always a substantial difference in markdowns between one-day promotions, such as Black Friday, and regular holiday sales. Look for deals every day, not just on Black Friday.

If you’re planning to save money with Black Friday this year, read these holiday shopping tips:

  • Have a plan -Know when each store opens and which “must-have” items are at each store.
  • Know the store policies -Each store does Black Friday differently.
  • Bring the store ads along – This is useful for price matching.
  • Get gift receipts – You may need them later.
  • Look for coupons ahead of time – Save as much as possible.
  • Compare prices online – Make sure Black Friday deals truly are the best deals.

7. Don’t wait until last minute for holiday shopping

Most importantly, start your holiday shopping early. Sticking to a budget is already tricky enough; If you wait until the last minute, you risk paying extra for shipping and get stuck buying items for higher prices so that you will have a gift to give.

If you haven’t already, start by making of list of everyone you need to buy for and potential ideas for each person. Aim to purchase early on when holiday deals are running, or do your research and decide when you’ll get the best savings. If you place orders, allow yourself a little extra delivery time to avoid paying for expedited shipping. Don’t forget – the holidays are here before we’re ready, so start now!

Focus on money management this holiday season

We have provided seven holiday spending tips to help you budget, save and navigate holiday shopping this year. Money management looks different for everyone. Pick the tips that work best for you and tackle holiday shopping like a pro. For more information on holiday spending, visit Your Money Guide on our website.