The holiday season is a prime time for overspending. Your generosity can easily get the best of you, and before you know it you’re having trouble paying the bills. Avoid stressing out about money this year by creating a gift-buying budget.
A clearly written allowance will help you recognize what you can afford and how much you will spend on each person. Here are a few tips for building your budget this year:
Make a List
Sit down with a pencil and a piece of paper and start making a list of all the people you’d like to buy a gift for this year. This should include any charitable gifts you plan to make, like gifts for a company toy drive.
After you’ve made your list, break the people on it into spending groups. Close family might be one category that you’d spend more on while co-workers would get gifts that cost a bit less.
Writing down everyone you’d like to give a present to will allow you to put your budget into perspective. You may have thought you could afford to spend $20 for every gift, but when you see your whole list, that number may be cut in half.
Doing this will help you avoid overspending on certain people, as well.
Determine How Much to Spend
Instead of assigning a dollar amount to each person right away, start with a total amount for all your purchases combined. For example, maybe your gift-buying budget is limited to $250 this year.
With a number in mind, you can start attributing dollar amounts to each person. The kinds of gifts you buy will all depend on how much money you have available and how many people you need to accommodate.
Avoid Multiple Presents
You shouldn’t feel compelled to buy a person more than one gift. Often, people overspend on someone because they’re afraid their gift will seem boring, so to make up for it, they buy more than one present per person.
Don’t fall into this trap, and be satisfied with a single item. Your friends and family will appreciate whatever they receive, so don’t feel too much pressure to impress.
After you’ve created your budget, stick to it. It’s there to help you stay out of financial trouble.
To make sure you keep to your budget, carry a paper copy with you when shopping. You should also avoid using credit or debit cards. Instead, get cash for the presents you plan to buy that day. When using cash, you can’t overspend because you’re limited to a set amount of money.
Money-Saving Tips for Holiday Gift-Giving
If you really can’t afford much this holiday season, there are a few things you can do to reduce the gift-giving pressure.[/tweet_quote] The first is to plan a fun holiday get-together with friends instead of exchanging presents. You can make cookies and watch seasonal movies so it still feels festive but is not as expensive.
You can also talk to your family about organizing a secret Santa or white elephant gift exchange. This could reduce the number of family members you’re buying presents for from five to one. You can be happy to contribute your gift and not feel guilty about how much money your spent because you’re doing it as a family.
Another way to save money is to consider DIY craft ideas instead of store-bought options. Handmade presents are fun and unique. They also tend to save you a lot of money.
The final suggestion for frugal spending this holiday season is to look for coupons and sales. Stores are always offering deals–you just need to be aware of them. If you sign up for their newsletters, you’ll be alerted when prices are being reduced.
If you don’t like the idea of receiving emails from a bunch of stores, you can always unsubscribe after the holidays.
This article was written by Rent.com from Forbes and was legally licensed through the NewsCred publisher network.