CLEVELAND — The holiday season can be filled with family, friends, and of course, spending.
During the holidays, sometimes spending can go far above the budget.
Brittany Matthews is a mom and a wife shopping for six.
“I try to do everything for Black Friday, which I did family, adults — I did all their Christmas pajamas, like clothes, like needs,” said Matthews.
During the holidays, she knows what she must spend and what she is buying. She prepares with a budget.
“We have meetings, and we do discuss,” said Matthews. “We have budget meetings; we have family meetings. The only issue is if the meeting will, I guess, come to fruition in real life.”
According to a recent survey from Beyond Finance, Matthews is a part of the 51% of people who make a budget for the holidays. They survey states 64% of people have already gone over their budget or think they will. Meltrice Sharp is a certified wealth coach and accountant who helps people gain clarity on how they spend their money. She is also a managing partner CLE Consulting Firm.
“The holiday season creates such an emotional demand on us,” said Sharp. “Oftentimes, we’re spinning out of guilt, emotions, expectations, and it’s important to really decide what it is that you’re going to spend money on.”
Sharp says sticking to a budget can give a sense of peace instead of chaos and regret going into the new year.
“They pay for the decisions that they made in December, in January, February and March,” said Sharp. “So, you’re starting your year off in the deficit.”
Sharp says the 50/30/20 rule can be an option — 50% of your income for your needs, 30% for your wants and 20% for savings.
“Do what makes sense for you and your family, something that you can stick to,” said Sharp.
Sharp recommends budgeting throughout the year and including the holiday shopping in that budget — something Matthews says she and her husband work hard to follow.
“We don’t have to cut back on anything because we’ve been planning all year,” said Matthews.
Sharp says don’t just budget for gifts but add in other costs like food, clothing and travel. When you shop for the holidays without a budget, Sharp says it leads to regret and buyer’s remorse.
“Not having to deal with financial hangovers after you’ve spent money that you didn’t plan to, or money that you didn’t have,” said Sharp.
Matthews says for her family of six, it’s about making memories, not regrets.
“Budgeting is a part of adulting, which isn’t that fun, but it is very necessary and it helps to provide the life in which I feel like my kids deserve,” said Matthews.
The National Retail Federation expects holiday spending to be more than a trillion dollars. The NRF expects November and December retail sales to grow between 3.7% and 4.2% over 2024. Last year’s holiday sales increased 4.3% over 2023, with $976.1 billion in spending.
Some tips to reduce overspending or spending over your budget include:
- Set a total number for your spending max
- Create a list of who to buy for and how much to spend on each person
- Categorize your spending
- Start a holiday fund in January and contribute to it throughout the year
- Shop early for deals and discounts, avoid last-minute anything (shopping, travel)
- Avoid buying for yourself when shopping for others
- Turn off one click buying or saved payment methods on websites to reduce impulse buying
- Make homemade gifts
- Avoid buy now and pay later
- Use cash or debit cards instead of credit
- Set up bank account alerts when your account gets below a certain number
Rose Todd
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