Even with the special pricing that comes around the holidays, it is still very easy to spend more than you intend to during the gift-giving season. In fact, getting a great deal on one gift item could encourage you to spend extra on another item. So how much does the average American actually spend on holiday shopping?
Data gathered from a 2016 study by the National Retail Federation says that the average American planned to spend $935.58 last holiday season — and that number is expected to grow by almost 4% this year.1, 2 This cost includes gifts as well as décor, flowers, food and greeting cards. A different study by TD Ameritrade breaks down these statistics even further to show that the majority of Americans actually spend even less than that:1
The majority of Americans — around 63% — report having a holiday savings plan prior to the season or a strategy for cutbacks in other areas to help make room for the added expenses. If you are in the 37% that chooses not to track their holiday spending at all, these tips below can help you stay on track.1
How Can I Keep My Own Holiday Spending Under Control?
Allocate Spending Amounts
Steve Siebold, author of the book “How Rich People Think,” recommends setting a per person budget. “Allocate a certain amount of money for each person you plan on buying gifts for and don’t overspend by even a dollar.” Use Google Sheets to track purchases and check in on your budget, no matter where you go. If you have something in mind that you really want to give a special someone but that breaks your budget, set up a price alert to find the best time to buy or see if someone would be willing to split the cost with you.
Use Gift Cards
Jon Lal, founder of coupon site BeFrugal.com, has a unique suggestion. “If you need to buy a holiday present and have gift cards, but are short on cash, trade your unwanted gift cards in and get gift cards for the store you want to purchase the gift at. Using a reduced price gift card site such as Cardpool, you can sell the gift cards you no longer want. These same sites let you purchase a gift card for less than face value, so you can save on a present by redeeming a gift card which you didn’t have to pay full price on.”
Don’t Automatically Reach for Your Credit Cards
“Don’t even think of using a credit card,” Siebold advises, “unless you are 100% sure you can comfortably pay it off at the end of the month.” Credit cards can make overzealous purchases too tempting. Even if you want to build up reward points, it’s not worth it if you end up with a balance on your card — the interest fees cancel out any sort of point perk!
Give Your Cart a Second Look Before Checkout
Finally, Siebold advises keeping track of your cart before you even get to the register. “Don’t get caught up in the moment. If your shopping cart is overflowing, step back, regroup and make sure you can really afford everything you plan to purchase.” In fact, you could even benefit from walking away from your purchase. Certain stores use a strategy called “retargeting” to encourage customers to complete their purchases. You may have seen this when you’ve abandoned your cart but see the item you considered on a sidebar ad on a completely unrelated site. Keep an eye out — sometimes there will be a promo code! Some online stores will also send you an email if you’ve abandoned your cart. In a day or two, they might even send you a code for free shipping or a percentage amount off. If you aren’t on a time constraint, these could be easy solutions to saving more during the holiday season.
If you’re looking to hone your budgeting all year round and not just the holidays, check out our guide to budgeting for the New Year.
1Frankel, M. (December 4, 2016). The average American will spend $936 on gifts this holiday season. Retrieved October 19, 2017, from https://www.fool.com/retirement/2016/12/04/the-average-american-will-spend-936-on-gifts-this.aspx
2National Retail Federation. (October 06, 2014). Holiday headquarters. Retrieved October 19, 2017, from https://nrf.com/resources/consumer-research-and-data/holiday-spending/holiday-headquarters