Family, Kids & Relationships

Simple Tips For Keeping Your Budget In Check During the Holidays

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It’s another holiday season, and the ever-changing landscape of the pandemic is expected to impact people’s spending habits once again.

Unsurprisingly, spending habits looked a little different in 2020 compared to 2019, thanks to the pandemic. Following so many layoff and other financial hardships, the 2020 Deloitte holiday retail survey surfaced that 1 in 3 families’ budgets were in a worse position than the previous year, and at least 2 in 5 families expected to spend less. 

This year, travel is expected to see an upswing as vaccination rates rise and people become more comfortable with airports, hotels, roadside dining, and seeing relatives. According to one study, one third of consumers say they plan to spend more on gifts in 2021 because they’re planning to see family and friends. In fact, fueled by optimism, as increased willingness to ship in brick-and-mortar stores, and concern about possible supply chain disruptions, lots of folks started their holiday shopping as early as October!

Other sources, however, say the opposite might end up being true. Reuters reports that product shortages, higher prices, and “lingering pandemic-related uncertainties” such as a risk of another COVID-19 spike will conspire to keep 2021 holiday spending growth at an eight-year low. 

Whether you’re still dealing with a reduced income level or you’re flush with stimulus cash, it’s always a good idea not to let your spending go unchecked. Of course, simply “not spending too much” can be easier said than done—here are some tips to help keep your budget on track.

Set a realistic spending limit

For parents who want to keep their budget in check, experts agree the first order of business is to set a realistic spending limit—and firmly commit to it. Without doing at least that, there’s a far greater chance you’ll struggle to curb your spending. According to a Conference Board survey, people plan to spend an average of $648 on gifts this year, with spending on non-gift holiday items like food, decorations, and wrapping paper expected to reach $374. While that might seem steep to many, the average American is expected to actually spend almost $1,400—meaning that setting a budget in advance could save you over $350.

Parents with multiple kids may want to consider setting a cap for each child, then making a list of their biggest gift requests. When deciding what to buy, remember some children might prefer to receive one more expensive “must-have” and nothing else, while others might be happier to receive multiple less expensive gifts. And when budgeting, don’t forget to include those less-noticeable holiday expenditures that still impact the bottom line—like generous tips for service workers and delivery folks, teachers’ gifts, wrapping paper, or the office/class party that everyone chips in for.

Reassess your savings

Last year, parents tended to focus more of their budget on gifts and decorations, with holiday travel largely being put on hold. So this year, be sure to readjust your (and your kids’) expectations if you’ll need to set aside some of those funds for travel expenses or entertaining again. On top of the usual hotels, gas, plane tickets, and restaurants, your travel might require things like additional disposable masks, extra cleaning fees, or rapid COVID-19 tests to ensure your holidays are safe.

Your savings might also look different this year due to any stimulus money or “child checks” from the expanded child tax credit parents may have been able to save up. Other families will still be recovering from job losses, evictions, and other major financial setbacks they faced due to the pandemic. The bottom line: Be honest with yourself about how much of your savings can truly safely be spent on holiday cheer.

Shop early

The earlier you start snagging gifts, the more leeway you have to wait for sales, promotions, and coupons. This is especially helpful this year, as supply shortages and delivery delays are expected to result in fewer discounts and a greater chance your prized items won’t arrive in time for the festivities.

Just don’t fall into the trap of overbuying later—if you find something on sale for your sister over the summer, cross her off your list! Resist impulse buying something else you know she’ll love in November.

Change your exchange

Even if it’s always been the tradition in your family, there’s no reason you have to buy gifts for every single sibling and cousin. Ask around, and chances are there are others looking to scale back in 2021. Some alternate arrangements you might consider:

  • If most of the adults are parents, you might all agree that everyone only buys gifts for the kids in the family. Or you might all give “family gifts” like board games instead of individual presents.
  • Draw names so that everyone is only buying for one other person. If you have a large family, you can have multiple groups that exchange names, like siblings, cousins, kids under age 12, etc.
  • Exchange DIY gifts, which often take a bit more time and thought than dropping something in your shopping cart, but are usually more personal, sentimental, and even free!
  • Have a “regifting” holiday, which is easier on both your wallet and the planet! Only give each other gifts that are “gently used” or that you made yourself—for example, make a set of greeting cards that your aunt can use to stay in touch during the following year, create a book of family recipes to share, or pass down a stack of t-shirts that are still in great condition to your niece who loves vintage Ts.

Give the gift of memories 

Another great way to keep your budget in check during the holidays is to give the gift of experiences—which is especially exciting as things start to reopen thanks to more and more people getting vaccinated, though it doesn’t have to mean expensive vacations. 

For example, you might try making a coupon book for trips to the ice cream shop, the arcade, or a museum. Or you could set up a series of day trips to see landmarks in nearby cities, visit the local zoo, or finally try kayaking as a family! Depending on the age of your child and your financial resources, these experiences can be as simple (and free) as a playdate, a trip to the park, or a DIY scavenger hunt. The more creative, the better. By creating a “coupon book” of these experiences now, you won’t have to pony up the money all at once but you’ll be setting aside quality time to spend together throughout the coming year.

Shop smarter

If possible, use credit cards that pay rewards or offer cash back when you use them, which can add up to substantial savings—though use cards with caution, and only charge an amount you can comfortably pay off when the bill comes to avoid ending up in debt in January. Better yet, if you go to brick-and-mortar shops, try leaving your credit cards at home and only use cash. It’s a lot harder to overspend when you have a finite amount of money on hand. 

Smartphone apps like Shopular and ShopSavvy can help you find the best price across multiple stores and in some cases, provide coupon codes and opportunities to earn cash back. Shopping online to avoid the crowds (and the virus)? Honey and CamelCamelCamel are browser extensions that spring into action the moment you click to buy something online. They check for coupon codes and promotions and compare prices across retailers, so you can snag the lowest prices. 

Plan ahead

If this isn’t the first year that keeping your budget in check during the holidays is a challenge, try saving up for next year beginning January 2022. Each month set aside a fixed amount and come next December, holiday shopping won’t feel like a huge hit to your wallet.

Don’t forget: No one said the most wonderful time of the year had to cost a fortune. Activities such as volunteering as a family, baking cookies for neighbors, and making cards for military members who are far from home are great ways to make joyful holiday memories—for free.  


Dealing with school closures, childcare issues, or other challenges related to coronavirus? Find support, advice, activities to keep kids entertained, learning opportunities and more in our Coronavirus Parents: Parenting in a Pandemic Facebook Group.

For ongoing updates on coronavirus-related issues and questions that impact children and families, please find additional resources here.