How to Financially Prepare for the Holidays

We get it—you’re wondering how it’s that time of year already. With the festive season quickly nearing, planning ahead will allow you to take control of your budget and avoid going overboard in the coming months. What steps can you take to stay on track and prevent the holidays from throwing off your financial goals?

Map Out your Holiday Schedule

What should you anticipate this holiday season? Are relatives flying in from another state? Annual office parties on the horizon? Start marking key dates on your calendar as soon as you know them, and be sure to include any related expenses in your budget. Some events might pop up only a few weeks before, so it’s essential to prioritize and determine what fits within your budget early on. For example, you might have to send your regrets to work parties if you’re hosting out-of-town guests. Organizing your holiday schedule in advance allows you to gauge how much time you can dedicate to managing your finances and ensures you’re well-prepared for the season ahead.

Book in Advance

Delaying your flight, accommodation, and travel bookings until the last minute can result in significantly higher costs. However, if you’re expecting family to stay with you and won’t need to book travel, how can you get ready for their visit? Would planning a family potluck be a good idea if everyone lives nearby? Create a checklist and start tackling tasks ahead of time to ensure you’re fully prepared for the holiday celebrations.

Prep your Credit Cards

You don’t want to overload your credit cards. A sudden spike in spending followed by a sharp drop after the holidays could hurt your credit score. Consistent, gradual use of your cards is essential, particularly if you tend to make impulse buys. If you’re accustomed to only charging a few hundred dollars, you should avoid nearing your card’s limit during the holiday season. If you know credit card debt might disrupt your financial stability, it’s best to avoid using them altogether to prevent accumulating excessive debt.

Buy Gifts Ahead of Time

Spread your spending out over the coming months. Rather than waiting for the holiday rush, get a head start. With the rise of online shopping, items can sell out faster than ever. Picking up a few gifts each month will help you better manage your budget and prevent scrambling for alternatives if things go out of stock. While it may seem like there are better bargains closer to the holidays, that’s not always true—often, the best discounts show up after the holiday season ends. Take advantage of current sales, discounts, and coupons. By pacing your spending, you’ll ease the financial strain and have more time to enjoy the festivities without the stress of last-minute purchases.

Holiday Budget FAQs

How can I avoid overspending during the holidays?

The key to avoiding overspending is creating a realistic budget. List all anticipated expenses, including gifts, travel, and food, and stick to it. Tracking your spending and prioritizing necessary purchases over impulse buys can help you stay within your financial limits.

How do I create a holiday budget?

Start by listing all your anticipated holiday expenses, such as gifts, travel, meals, and decorations. Assign a spending limit to each category and make sure your total doesn’t exceed what you can afford. Tracking your expenses as you go will help you stay within your budget.

How can I prepare for unexpected holiday expenses?

Setting aside a small cushion for unexpected expenses is crucial. Whether it’s a last-minute gift or an unplanned event, having some extra money in your budget will keep you from reaching for credit cards. Building an emergency holiday fund ensures you’re prepared for surprises.

When should I start saving for holiday expenses?

It’s best to start saving as early as possible, even several months before the holidays. Setting aside small amounts regularly can prevent a financial crunch as the season approaches. The earlier you start, the less stressful it will be to manage holiday-related costs.

How can I stick to my holiday budget?

To stick to your budget, track every purchase and avoid impulse buys that aren’t in your plan. Shop early and take advantage of sales to maximize your spending power. Sticking to a list and comparing prices can also help keep you on track and prevent overspending.

Get Ahead of Holiday Debt

Do you need help achieving financial freedom? Contact one of our friendly counselors at New Era Debt Solutions to learn more about finding the debt relief option that best fits your needs and budget. We look forward to getting to know you and creating a plan designed just for you. Our counselors are with you every step of the way.