The COVID-19 pandemic has sent devastating ripples through the economy. If you have faced job loss or reduced income because of the impact of the coronavirus, the upcoming holidays can be an extra stressful time financially with the added pressure of gift-giving and various other holiday-related expenses. But you don’t have to let the impact of COVID-19 on your personal finances ruin your holidays. Here are a few ways to save on holiday spending this year, even if you have taken a financial hit due to the pandemic.
Set a Specific Budget
Budgeting all year round is the best way to deal with reduced income from the impact of the virus. But, it is especially important to create a specific holiday budget of what you can afford to spend – and stick to it. Set a specific limit of what you can and will spend on each person on your gift list. Also, when you are creating your holiday budget, make sure you remember all your holiday expenses and not just gifts. Non-gift expenses include: gift wrap, Christmas and other holiday cards, tips to your mailman, doorman, etc., costs of hosting a party or dinner, and the costs of traveling to family.
Only Buy What You Can Afford
Even in the best of times, people tend to overspend, maxing out credit cards during the holidays only to regret it big time when the bills come in January. Now is the worst time to do that. You must be disciplined and only spend what you can afford. People will understand. Most everyone is in the same boat.
Use Reward Points
You have very likely saved up some valuable reward points during the year — now is the time to cash in. Cash back savings and loyalty points at specific retail stores can be useful to save on Holiday spending. You may even have accumulated hotel or airline points that can save you hundreds on travel expenses.
Think Outside of the Box
And finally, do not be afraid to think “outside of the box” — the gift box that is. Even if you are not overly creative, a homemade gift made with love is often far more appreciated and treasured than a store bought expensive one. This is especially true if you have kids make gifts for grandparents, aunts, uncles, etc. For your kids or other close relatives, now can be a great time to pass along a family heirloom.
The bottom line is that the holidays should always be more about spending time with and appreciating your loved ones, rather than spending money on them. Sometimes it takes hard times for us to realize what the real value of family is.
Have a happy and joyous holiday season!
Has your income and finances been reduced by the pandemic? How are you planning on “cutting back,” but still enjoying the holidays this year?