There’s no doubt this holiday season will look different for many Americans as people cancel travel plans and opt for scaled-down or fully virtual holiday gatherings. But one thing that won’t change much this year is holiday spending. According to the National Retail Federation’s 2020 holiday survey, Americans plan to spend only slightly less on gifts, decorations and other holiday supplies this year than they did last year.

If you want to spread some holiday cheer while keeping your finances on track at a time when people are encouraged to spend more, here are some tips to help you get started.

  • Establish a spending limit. There’s nothing wrong with creating a festive holiday atmosphere and giving gifts to your loved ones this time of year. But if it means starting the new year off with a mountain of debt, it’s probably not worth it. Decide how much you’ll spend on all your holiday expenses and stick to it.
  • Be careful with credit cards. It’s easy to lose track of how much you spend when you use credit cards instead of cash. If you like the convenience credit cards provide, don’t wait until the end of the month to see what’s on your bill. Keep track of every purchase you make, and only use your credit card to buy things you can pay for with cash, so you can pay your bill in full when you receive it.
  • Cash in your points. Speaking of credit cards. If you have a rewards card, consider using points you’ve earned to purchase holiday gifts for your friends and family.
  • Give homemade gifts. If you’re the DIY type, you may want to skip the store-bought gifts altogether this year, and give homemade items — such as food, ornaments, picture frames, candles and jewelry — instead. The cost to buy supplies you might need will likely be much lower than purchasing a ready-made gift at the store. You could also give the gift of your time. Offer to babysit, pet sit or help out with projects around the house. It won’t cost you a thing, and your loved ones will appreciate it.
  • Skip the pricey gift wrap. If each of your gifts looks like a work of art, complete with expensive foil paper, bows and ribbons, think about taking it down a notch. The cost of gift-wrapping supplies can quickly add up, and the more elaborate the embellishments are, the more expensive it’ll be. Stick with basic wrapping paper you can get at the dollar store and skip the decorative touches to save some money this year.

If you’re trying to balance making this holiday season an enjoyable one for you and your family with paying down debt, you may want to consider a home-equity loan. A home equity loan can consolidate multiple debts into a single monthly payment, and you might qualify for a lower interest rate than what you’re currently paying.

If you want to learn more, our Licensed Mortgage Professionals are available to answer your questions.



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