It may only be October, but the holiday season is just around the corner. While it’s not quite time to break out the wreaths or inflatable yard art, it is a good time to start thinking about your budget—because according to a 2015 Gallup poll, Americans spend an average of $830 on holiday gifts alone.
Failing to prepare for that kind of outlay can wreak havoc on your finances: A MagnifyMoney survey found that Americans who charged their holiday spending added an average of $986 to their debt load last year—a sum that could take years to pay back after accounting for accrued interest.
A better idea: Make a spending plan and start saving for holiday expenses now.
“You don’t want a holiday hangover,” says Marguerita Cheng, Certified Financial Planner and CEO of Blue Ocean Global Wealth. “You don’t want to not be able to do something fun for spring break because you’re still paying for holiday gifts. So look at your budget and determine how much you can allocate to your holiday spending plan.”
The beauty of starting early is that there’s still plenty of time to boost that budget and stretch your savings before the holidays officially roll around. Here are a dozen strategies to help you do just that.
1. Pay yourself first.
Hopefully you’re already in the habit of automatically moving some money to savings right after each payday. By paying yourself first in this way, you’re forcing yourself to live below your means. (Plus, behavioral economists have found that once you’ve transferred the money to savings, you’re unlikely to make the effort to move it back into checking.)
“We’re all really busy people,” says Megan Ford, president of the Financial Therapy Association. “Financial shortcuts like this can be really helpful for people who wouldn’t otherwise manage that on their own.”
For the holidays, challenge yourself to increase the amount you automatically save. You probably wouldn’t even notice an extra small amount going straight to savings—but after a few months, it can add up to a nice boost to your holiday fund.
2. Shop smart.
You know the holidays are coming every year, so don’t wait until the Christmas displays come out to start shopping for gifts. Keep an eye out for good buys now, says Cheng, and take your time so you’re not forced to buy at full price—or brave the crowds on Black Friday—if you don’t have to.
3. Use a coupon app (or five).
Clipping coupons can be a time-consuming pain. Luckily, there are many apps and digital tools that you can download to make it easy to bag some savings while you shop this fall.
For example, the browser extension Honey pulls up coupon codes for you as you shop on sites like Amazon, Walgreens and J. Crew. It can help you get free shipping, 30 percent off or other great deals—without any extra effort on your part.
4. Be loyal.
You probably know that loyalty pays when it comes to hotels and travel, but the same goes for other kinds of retailers. Especially around the holidays, when your shopping game is on turbo, signing up for loyalty programs can net big rewards. For example, if you join Bloomingdale’s Loyallist program, you earn up to 8 points per dollar each time you shop. At 5,000 points, you get a $25 gift card.
5. Get cash back.
Loyalty programs aren’t the only way to get paid for spending. Cash-back credit cards, such as the Citi Double Cash Card and American Express’s Blue Cash Preferred Card—both top picks for credit-card research firm WalletHub.com—allow users to earn money on every dollar spent. The free Citi card pays 1 percent any time you use it and another 1 percent each time you pay your bill—netting you 2 percent cash back for all your spending. The Amex ($95 annual fee) pays 6 percent cash back up to $6,000 annually at U.S. supermarkets, 3 percent for gas and 1 percent for other purchases.
Other ways to earn cash back: Shop sites like Ebates, FatWallet.com and Splender, which let you recoup a portion of what you spend on certain purchases. If you use the Acorns app, you can also get money invested into your account whenever you shop with Acorns “Found Money” partners like Jet.com, HotelTonight and Dollar Shave Club using cards linked to your account.
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