This is the season to start a Christmas savings plan

Don’t want to scream when you see Christmas deals in stores before Halloween? Or when the phrase “starting looks a lot like Christmas” has stuck in your head for two months because it starts playing in early November?

The Christmas creep can be annoying, but there’s at least one good reason to start thinking about the holidays before the leaves start changing color: It gives you more time to save.

Given the current path for the holidays, you’ll need your secret savings stash.

Found the National Retail Federation Holiday spending rose 14.1% In 2021, American consumers paid more than $886 billion to spread some holiday cheer.

Waiting until November or December to prepare for these expenses means you’ll often end up charging and paying a fee for your purchases — plus interest — at the start of the new year. Instead, make a Christmas savings plan now to avoid debt and overspending.

6 Steps to Create a Christmas Savings Plan

Not sure how to get rid of extra money for the holidays? Here are six easy steps to get you started.

Step 1: Start with the end

To save enough money to cover all your vacation expenses, find out how much you plan to spend and divide it by the number of weeks you have until it’s time to start shopping. This will tell you how much money you need to save per week to build your Christmas fund. In the field of personal finance, we call this setup a sank box.

Step 2: Make a gift list

To estimate your total savings goal, first make a list that includes who you’ll shop for and how much you’ll spend on each person. It may be helpful to indicate what you spent last year. Or you can look up the prices of the items you plan to buy per person and their total.

Step 3: Check it twice

ATTENTION: A Christmas savings plan should cover more than just gifts. So add the estimated costs of decorations, food and holiday events to your shopping list. Between special occasions where you contribute a bottle of wine or gifts for your kids’ friends or Secret Santa’s office, as well as an actual holiday food reward, these “extras” can really add up.

How much should you budget for seasonal additions? The average cost of wine varies from country to country but ranges from $10 – $15 a bottle. And if you want to bring a dozen bakers to your holiday party, Hello Fresh’s 2021 Christmas cookie price index reveals that the ingredients will cost you about $6.10 per batch.

Step 4: Solve the math

Add everything up and divide it by the number of weeks left until you reach the stores. Unless you’re a last-minute shopper, that means giving yourself some wiggle room before December 25th.

To make things easier, we’ve figured out how much you need to save per week over 12 weeks to get extra money from $200 to $1,000 for the holiday season. Statista refers to the average US consumer spending $886 Get Christmas gifts during the 2021 holiday season.

If your Christmas budget is $450, you’ll need to save $38 per week for 12 weeks. If you want to save $800 to meet your Christmas savings plan goals, you should set aside $67 per week for 12 weeks.

Step Five: Consider Setting Boundaries

Another way to save holidays is to determine how much money you can save and create your vacation budget accordingly. For example, if you were able to save only $25 per week to go into your Christmas savings, you would save $300 in 12 weeks. This will be the maximum for all your vacation expenses.

If you think you’ll need more money to pay for all of your Christmas expenses and you’re still out of debt, you’ll need to start saving early so you have more weeks to save. In fact, you can implement your Christmas savings plan at any time during the year.

Step 6: Keep Your Vacation Savings Separated

When you start saving for Christmas, it’s a good idea to keep your holiday savings away from the rest of your money so you don’t accidentally spend your savings on day-to-day expenses. If you use a sub-savings account at your bank or credit union, set up automatic savings transfers each week to ensure you stay consistent.

If you take cash envelope Make sure you have an envelope dedicated exclusively to vacation expenses and not to other short-term goals. Set weekly calendar reminders to alert you to putting money aside.

Two tips to help you save money for the festive season

When saving money in the short term, there are two primary strategies to consider.

Strategy 1: Reducing Expenses

Cutting the fat out of your weekly spending is a good way to find extra cash to put toward Christmas gifts. Take your budget and identify all unnecessary recurring expenses. Decide on a few — like fast food or trips to the nail salon — that you can give up until you’re done with your holiday shopping.

If you want to increase your savings quickly, try A No Spending Challenge. Or cut your grocery budget by doing Store Challenge And do meal planning with what’s already in the house.

Strategy 2: Generate Extra Income

Saving money for the festive season isn’t just about making cuts. You can temporarily increase your income by taking a part-time vacation (a bonus if you get a discount from the company) or doing odd jobs on Fiverr or TaskRabbit. Or put your hobbies to work making and selling something cute and crafty on Etsy. And don’t forget to make room for the new gifts you’ll get by cleaning your closets and selling things online.

How to save money on gifts during the holiday shopping season

In addition to the Christmas savings plan, you also need to set a Christmas budget that works for you financially.

Here are seven ways to cut back on spending this holiday season:

1. Make your own gifts.

Get some Christmas gifts for your friends and family.

Worried that your homemade gift will look scrawny? try 100 Eid gift ideas that won’t cost you a penny For affordable gifts that your friends and family will cherish.

2. Shop early and take advantage of sales.

Instead of waiting until you hit your Christmas savings goal, you can use the money you’ve been saving to buy gifts early when you get something on sale. Bonus if you save any coupons.

Early shopping could be especially important this year Supply chain concerns persist. The old saying “time is money” applies during the holiday season when finding popular Christmas toys can be difficult.

3. Use old gift cards.

It’s easy to forget gift cards you got long ago that still have credit. Dig your cards and check the balance. Buying gifts with your gift cards will save you cash to use for something else.

Can’t find the right gift to use your gift card balance? See our advice on Best sites to sell gift cards Converting this plastic into cash.

4. Cash in your rewards credit card.

If you get cash back or points for swiping your credit card, save them to use on your vacation spending. Just be in charge of your credit card so you can win this debt-free Christmas.

See our recommendations for Best cashback credit cards.

5. Apply the rule of four gifts.

Save money by limiting the amount of gifts you give your children. The Ruling on four gifts He focuses on making every child just four things: something they want, something they need, something to wear, and something to read. Plus a small bonus from Santa, especially for the little ones.

Read more about the Four Gifts Rule over here.

6. Shop Comparison Online.

Shop online and compare prices to get the best deal. some Browser Extensions It will even do the savings work for you. Be aware of shipping costs when shopping online. These stores offer Free shipping with no minimum order.

7. Set your calendar for sales.

It’s easy to browse and then forget to go back in for a sale. Set up appointments on your calendar to remind you when holiday sale prices start, especially for big-ticket items like electronics.

Not all holiday sales are created equal. Use our guide to Best time to buy everything To get the best deals by Internet Monday or Black Friday.

Kazueda is a senior writer for The Penny Hoarder. Nicole Dow is a former senior writer.

This article was originally published by Penny Horder.

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