Really smart consumers save up all year for the holidays — $20 each month turns into a $200 holiday shopping nut once November rolls around. But if you didn't do that — and I'm sure you're not alone — take a look at your budget over the next two months and see where you might be able to cut back to make room for extra holiday spending. Can you scale back on eating out? Put off any planned purchases for yourself? Even little things, like canceling HBO for a month or two or clipping coupons and sticking to a strict list at the grocery store go a long way.
Once you have your budget, make a list of the people you need to shop for and then divvy up that cash among them. This means you'll remember Uncle David, but it also means you'll head to the stores — or to your computer — with a road map in black and white. Sure, your mom would love an iPad Mini. But if the budget says $30, she's getting a few DVDs instead.
Credit cards easily allow people to get in over their heads and wake up with a holiday hangover come Jan. 2. Plus, studies show that we spend less with cash than we do with credit. If you pull a set amount of cash out of the bank and head to the mall, once you run out, you run out. (This strategy, of course, doesn't work when you shop online, but your debit card or PayPal is an OK substitute — the idea is to spend money you have, right now, in your bank account.)
Or, even better: Use gift cards. Some people have a drawer full of them, but most of us have at least one or two unused ones lying around. If you're not planning to use them for yourself — and if you've had them since last year, I'm putting you in this category — save some cash by using them to purchase gifts for others. It's like free money you can add to your budget.
The general advice on deals is that the closer to Christmas, the lower the prices. But you'll find a wide selection by shopping early, and you won't have that sense of pressure to close the deal. Even if you pinpoint what you want to purchase, then track prices until they drop within your budget, that's better than waiting until the last minute and then shopping without a specific item in mind.
A budget isn't any good if you don't follow it, so be sure to note — either with a computer or phone app or plain old pencil and paper — what you are spending where. Not only will it keep you on track financially, but it will remind you if you've already purchased a gift for someone (We have all, on occasion, doubled up because we forgot we'd already bought a gift earlier in the season. Hey, it's a long two months.)
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