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Debt-Free Holiday Budget Guide

Director of Education and Corporate Communications
Financial Literacy Specialist

The winter holidays are the busiest shopping season of the year. Retailers generate 20% of their sales during Thanksgiving weekend alone. So, while the holidays are a time for joy and love, they can also be a prime time for debt. To avoid a holiday debt hangover, you must plan carefully and build a holiday budget that keeps you on track. Luckily, you’re in the right place!

Holiday Survival Guide

Consolidated Credit provides tips on how to have a debt-free holiday season, such as not buying gifts for everyone, providing homemade gifts and gift exchanges with various amounts of people.
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Holiday Survival Guide: Make a Practical Holiday Budget

Holiday Budgeting Guide

Financial Planning

No matter how much people love the holidays or how well they’ve planned, many people find themselves frazzled at some point. This publication helps you develop a practical spending plan to cover all your expenses, from gifts and decorations to travel and entertaining. Learn how to enjoy the holidays without taking on debt.

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How to Build a Holiday Budget

  1. Write down everyone you plan on gifting this year.
  2. Decide what you want to buy for each person, then comparison shop to determine the price of those items.
  3. Now use the holiday spending planner below to build your holiday gift budget.
  4. Add in all your other holiday expenses, including: decorations, travel costs, postage and shipping, food and entertaining.
  5. Total it up to see how much money you need to cover the purchases.
  6. Compare this to the free cash flow / savings you have available to spend this year.
  7. Cut back as needed to keep your expenses in line with your available funds.
  8. Use our holiday spending checklist to make sure you’ve covered all the expenses you need for the holidays.

When is the right time to start shopping?

The earlier you begin shopping for the holidays, the less likely you are to rely on credit cards. More time means more paychecks to absorb the cost. This is why we’re fans of starting as early as possible because it helps you avoid debt. In fact, shopping year-round can be a good strategy, so you can buy items as they go on sale.

Here is a quick look at when most people shop for the holidays:

See when most people plan to shop for the holidays

4 Ways to Avoid Holiday Overspending

#1: Set up a Black Friday shopping strategy

Black Friday can be the best day of the year to score deals on specific types of items. But don’t be fooled into thinking you can buy just anything at a huge discount! Getting the best deals on Black Friday takes planning.


What’s Your Black Friday Shopping Strategy?

Use Consolidated Credit’s new infographic to craft the right Black Friday shopping strategy so you can stay on budget and avoid credit card debt….

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#2: Shop securely on Cyber Monday

In 2017, Cyber Monday overtook Black Friday as the biggest shopping day of the year. If you like to shop online, this is the day for you. But retailers are savvy at getting online shoppers to spend more. You still need a smart shopping strategy in order to save money and avoid debt.


Be Cyber Safe on Cyber Monday

Consolidated Credit offers this helpful infographic that shows how to you protect your identity as you shop online this year on Cyber Monday….

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Get more tips for shopping smart on Black Friday and Cyber Monday »

#3: Help your kids build a gift budget

Instead of succumbing to a constant stream of “buy me,” use the holidays to teach your children about budgeting. Get together as a family to set limits on gifts, either by cost or number of presents. Then help you children set up a budget for each person on their list.

Learn how to use the holidays as a budgeting lesson »

#4: Plan carefully for big holiday meals

Costs for big holiday meals and parties can add up quickly if you don’t plan ahead. Counting portions, limiting dish options and asking guests to bring items can go a long way to limiting your out-of-pocket costs.

Get 10 tips for feasting without feeding your credit cards »

10 Tips for Avoiding Holiday Debt

Even with a solid holiday spending plan, you may find yourself going overboard. That usually means pulling out the plastic to charge those extra purchases. The following tips can help you stay on budget so you don’t end the holiday season with more debt than you intended!

Cut back regular costs in your household budget to increase the cash flow you have available for holiday spending. Take your lunch to work, cook at home instead of dining out, and don’t buy clothes or home goods (put them on your list). You can also plan ahead to avoid expenses like car maintenance or vet visits for your pets around the holidays.

Once you complete your holiday budget, take the shopping list with you wherever you go. Save it on your smartphone so it’s always with you. And make sure you have it even if you shop online or through an app. Retailers are very good at putting online ads in front of you to get you to spend more. Stick to your list and avoid impulse purchases.

We’re not kidding! Take your credit cards out of your wallet and find a big glass or jug you can fit them in. Then fill it with water and stick it in the freezer. With your credit cards stuck in ice, you won’t be able to use them to overspend. At the very least, you’d have to wait until the ice melts to get to them. That gives you time to reconsider using them, which can help keep you on track.

Buying individual, personalized presents for everyone that you know is expensive. If you have more than 10 names on your gift list, it’s probably time to cut back. Review everyone you’re gifting and take one name off the list. If you really can’t find anyone to cut, then it’s time to consider bulk gift options or handmade gifts.

Early reservations reduce the cost of airfare and accommodations. Bundling flights, hotels and car rentals usually gives you an even better deal. Start comparison shopping for your flights early and use Consolidated Credit’s Tips for Cutting Air Travel Costs to get the best price possible.

Instead of paying two different professional services to take care of your house and pets while you’re gone, find a responsible teenager in your neighborhood who wants to earn some extra cash. Show them everything they need to take care of while you’re gone – house care, watering plants, feeding and walking pets. Paying a teen will cost less than professional services and let you group everything together.

If you love to decorate for the holidays, you know costs can get out of control quickly. Instead of buying new stuff this year, rearrange everything that you have already. You can also set up a decoration swap party with friends or family that don’t live in your neighborhood. Each person brings items they’re willing to trade. Then you swap stuff out and everyone gets to have “new” decorations. Just make sure to agree, in advance, how you want to cover costs for damaged or broken items – accidents happen.

This applies to meals, parties and extended family visits. For meals and parties, ask your guests to either bring a dish or bring the hard liquor they wish to drink; you provide mixers and nonalcoholic beverages. Additionally, if your house looks more like a hotel during the holidays, as your guest to chip in a few bucks to cover costs for their stay. A little bit can help with your budget and it’s still much cheaper than them booking a hotel.

Instead of spending all your energy focusing on the stuff you need to buy, focus on creating a new family tradition. Set up a family holiday movie night, plan a bonfire, pack everyone into the car to take a Christmas light tour, or volunteer as a family to help a charity, such as Toys for Tots. Planning an inexpensive new tradition will help you make memories instead of amassing debt.

If you end up charging anything for the holidays – whether it’s on purpose to earn rewards or because you ended up overspending – don’t decide to ignore your balances until the New Year. Once people start running up balances at the holidays, the instinct is to ignore the debt until the holidays are over. You end up making a conscious decision to charge whatever you need and worry about the debt next year. But that’s a recipe for a bad start to your New Year.

Instead of ignoring your balances, keep track of them and make sure they stay manageable. If you see that the total is getting too high for you to repay on your own, don’t wait to get help.

If holiday overspending leads to credit card debt, talk to a certified credit counselor to find a solution today.

One last thing when shopping for the holidays…

Being the year’s busiest shopping season also means that the holidays put you at a higher risk of identity theft. As you shop for the holidays – both in-store and online – take steps to protect against ID theft and credit fraud.

Learn how to prevent holiday identity theft »