Avoiding Financial Stress During the Holidays

The stress of the holidays is such a constant from November through New Years that it’s become a complete cliché at this point. But, the fact is that it’s much more stressful for some people than others.

For many people, getting from paycheck to paycheck alone and maintaining housing, bills, groceries, and loan repayments already feels like a task that is stretching them to their limits. Now add the holidays into the mix. 

Some people can afford to put gifts into their budgets but have to closely control the amount they spend. This leads them to wonder if the recipients of their gifts will think that they’ve been cheap or didn’t care enough to get “real” presents.

Financial stress during the holidays can be one of the significant contributors to holiday-related anxiety and depression. Fortunately, there are strategies you can use to make holiday spending seem less daunting and more doable. These tips won’t magically grow your bank account. Still, they’ll give you ways of thinking about the holidays that will help you spend responsibly and consider your options so that you can make the most of whatever you have to pay.

Make an accurate holiday budget.

When making your holiday budget, plan for all the expenses you’ll incur, not just gifts. Will you be traveling? If so, by air? Car? Train? How much will tickets and/or gas cost? What about extra fees for things like checked baggage? Will you be hosting any parties? If so, what’s a realistic estimate for how much you might spend on food? Will you be going out to eat more as you travel to places and catch up with people you haven’t seen in a long time? All of these expenses should be totaled into your holiday budget. This will help give you a more realistic idea of how much you can actually spend on gifts. A detailed budget like this might also help you realize that some of your holiday ambitions are just not possible. Maybe you were planning on throwing a party but find that it’s just not in the budget this year.

With gift-giving, decide whether you want to go “narrow and deep” or “wide and shallow.”

This idea comes directly from Maryalene LaPonsie writing for the financial section of U.S. News. LaPonsie says that you can approach holiday shopping one of two ways: decide to get a larger, more expensive amount of presents for just a few people or choose to get a smaller, less expensive amount of gifts for many people. Unless you’re very wealthy, you shouldn’t attempt to do both. Some people just love gift-giving and want to spread that joy around as much as possible. If that’s you, then good for you and your generous spirit! Just remember that you’ll have to be very careful and restrict yourself to a certain not-very-high dollar amount for each person on the list.

Decide what you’re getting for people early so you can comparison shop.

Suppose you have an idea of the gifts you’re getting for the people on your list, preferably somewhere around mid-November. In that case, you have plenty of time to comparison shop. You can check weekly paper ads and online vendors once a day or once a week to check for sales. In the weeks leading up to the holidays, there will be a sale, no matter what you’re looking for.

If you have to give gifts to a bulk group of people, consider going homemade.

Of course, you very rarely have to give gifts. Still, some work environments, for instance, have cultures where everyone distributes gifts to their immediate coworkers. If you don’t, you’ll feel like the one person at work who was a Grinch. To deal with this pressure, just go homemade. The internet is absolutely full of ideas for homemade baked goods, for instance, fun holiday decorations or themes.

Be honest with your loved ones about your financial situation, and propose a specific gift-giving arrangement.

For example, suppose you can’t afford to buy presents for all 23 of your extended family members who will gather together for the holidays. In that case, you could suggest doing a Secret Santa. You could also offer other alternatives, like limiting spending to a specific low dollar amount for every family member or only buying presents for the kids, who are looking forward to them the most. Suppose your family is highly selfish and lacking in empathy. In that case, they might say no, but chances are they will understand and want to help you avoid adding further stress to your life.

Limit your use of credit, and keep track of purchases diligently.

Using cash is preferable because it doesn’t allow you to just keep spending and spending; when it runs out, it runs out. But using money might not be possible for all people, so if you need to use credit, record each holiday purchase you make immediately. Do it with any method you like – plain old pencil and paper, a money-tracking app on your phone, or whatever. Just make sure that you track your purchases right away because you’ll be amazed at how quickly you’ll lose receipts or electronic confirmation emails. Remember, it’s essential to keep a continual eye on how much of your budgeted funds you have left.

If you use all these methods and still feel like the money won’t stretch far enough, keep in mind that it’s highly possible to have a minimalist holiday season. You can choose to not exchange gifts at all! Many people have this conversation with their families. They agree that just spending time together is the real point and joy of the season anyway. Obviously, not all individuals or families will go for this. But some agree that after they chose this tradition, they enjoyed it so much that they just kept doing it; it helps them feel like they’re actually embracing the spirit of the holidays and significantly lowers their holiday stress.

Feeling overwhelmed by and unable to deal with the financial burden of the holidays? You can call us at (305) 501-0133 or click here to schedule a free 20-minute Clarity Consult to learn more about how I can work through these feelings with you.