We all love holidays. The holiday season is the time when we can truly unwind and spend some quality time with our family and friends. The holiday season also gives us the excuse to splurge a little more on our loved ones and ourselves. But with all this comes big expenses! Many of us may try not to focus on this aspect too much, but for many others, sticking to a plan may seem like the best way to go. And we agree!

You may be wondering – what fun is it to restrict spending during holiday time? Navigating across financial constraints to find the perfect balance between spending as well as not going over a budget is what proper planning can help you accomplish. So, what if we tell you that you can still splurge if you plan well beforehand? Let’s answer this with Ankita’s story!

Anika was excited as the holiday season was soon approaching. She always looked forward to holiday spending because this was the time when she could allow herself to go on a shopping spree and not feel guilty.

Ankita, however, finds herself to be a little stressed as she is worried that she might have no control over her spending. She approached her friend, who is a financial planner to help her. Financial planning for the holidays does not need to be a big challenge. It just takes a few smart holiday shopping budget tips and a dash of discipline.


Here is how Ankita could structure her Holiday Budget:

1. Start saving for the holidays months before the season starts

Whenever you have a chance to save for the holidays, do it. Even if it is 500 per month. It will add up and take a lot of pressure off you during the holiday season. If you are doing a lot of your shopping online, look for coupons or deals that can help you get a discounted price. There are dozens of apps and websites having major deals during the holiday season.

Anika had the idea of getting gifts already in mind but creating a kitty for this would help her not cross her spending budget.


2. List down your Holiday expenses

Start creating your holiday budget by writing a list of everything you will need to purchase. You can create a plan for your expenses, including decorations for the house, extra beverages, food, and other goodies to make the holidays memorable!

Here are some major holiday spending categories to consider adding to your list:

      • Gifts are one of your major holiday expenses. That is why a gift category should be at the top of your list. Anika could list all the people you would like to buy for. Then add the gifts you would like to give them and attach an estimated cost for each.
      • Food and Entertainment expenses – There are so many wonderful things to do during the holidays like holiday plays and shows, concerts etc.
      • Holiday Decorations & Holiday Attire. Dressing up during the holidays is fun—but it can also be costly. So be sure to add a holiday attire category to your list.
      • Travel: If you have moved away from your hometown and plan to go home for the holidays, for example, there will be travel costs.


3. Saving for big-ticket items

Putting money aside for big-ticket items can prevent you from depleting your accounts or going into debt during the holidays. For example, if you know you are going to need to replace your car soon, you could start putting away money for one now.


4. Stop Procrastinating

Waiting until the last minute to buy all your gifts will throw you off your financial game plan. The earlier you can start, the more options you will find. Plus, shopping is so much more fun when you are not in a rush! Even though Anika had the plan of buying gifts and shopping for the holidays, she did not act on it. If she waits until the last minute, she will not be able to stick to the budget she had in mind.


5. Put Together Your Shopping List

Having a well-thought-out shopping list is a must-have when budgeting for the holidays. It becomes easier to shop when we know what to buy which also helps in sticking to the budget. Anika was already on track with this one. Reviewing her list and the sales ahead of time can help her maximize savings.


6. Put Your Rewards Points to Use

Sign up for a credit card or debit card program that offers rewards points on your purchases. Then, use your rewards card throughout the year to accumulate points or cash back from your purchases that you can use later in the year to pay for a portion of holiday gifts. Anika can make use of her accumulated reward points from her credit card spending this year for getting cash backs.

Sometimes the hardest thing about saving money is just getting started. Remember, the holidays can still be enjoyable when they are low-key—even more so.

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