With all we’ve endured this year as a result of the COVID-19 pandemic, it may be tempting to spend just as usual or even go bigger to give the holiday season a sense of familiarity and comfort. But it’s important to look at how your finances have been affected this year and how they might look in 2021. This is the year it may make sense to pull back. Fortunately, reducing your gift-giving budget doesn’t have to mean sacrificing the holiday spirit. Here are five tips for smart spending during the holidays:
- Set spending limits. It’s easy for holiday spending to add up quickly. Instead of winging it, consider setting a spending limit before you start shopping. If you look, you can find charming and memorable gifts at virtually any price point. Starting with a limit can help narrow your gift search to the kinds of things that will delight recipients—without stressing your bank account.
- Try a gift exchange. If everyone on your list is likeminded, consider replacing traditional gift giving with a gift exchange. Each person in the group picks a name at random and gives only to that person—usually with a recommended spending cap. Everyone gets a gift and is spared the expense of buying for multiple people.
- Focus on low-cost, high-touch gifts. If you have more time than money this year, there are lots of thoughtful, low-cost gift options. Think about baked goods, origami, small knits, crocheted ornaments or scented candles in recycled jelly jars. If you have little ones at home, a photo calendar or framed picture could make a great gift for relatives.
- Get creative for the kids. Dream up some socially distanced experiences for the children in your life. For example, let them unwrap a treasure map that leads the way to a secret cache of candy or put together a hot cocoa kit with a coupon good for one day of sledding this winter. If they’re your kids, you could let them stay up late for a special family movie night or game night.
- Skip gifts altogether. It might be a cliché that the most important part of the holidays is togetherness, but that’s likely never been truer than in the midst of so much isolation. An intimate holiday at home with immediate family or a little quality time via video chat may be more meaningful than a physical gift.
For help with budgeting through this and every season, try M&T Money Smart, a complimentary budgeting tool for M&T Bank’s online and mobile customers.
This article is for informational purposes only. It is not designed or intended to provide financial, tax, legal, investment, accounting, or other professional advice since such advice always requires consideration of individual circumstances. Please consult with the professionals of your choice to discuss your situation.