How to Save Money for the Holidays

The last thing on your mind after the holidays might be more gift-shopping. However, by saving money as early as possible, you can skip the stress of trying to find the money to make the holidays a joyous time.

Setting a Realistic Budget

If you don’t have a budget, it’s time to make one. The goal of putting together a budget is to understand how much income you’re generating and understand what financial obligations need to be met monthly so you can determine how much you can be saving.

Start with a list of essential expenses like:

• Rent/mortgage
• Utilities
• Insurance & taxes
• Groceries
• Vehicle-related expenses like gas

Then create another category of non-essential expenses like:

• Entertainment
• Media subscriptions
• Shopping

If you’re using a credit card to pay for a lot of these items, oftentimes, the credit card company will have a spending summary available that will categorize everything for you.

Building a Holiday Savings Fund

Once you have a complete understanding of what your monthly spending habits are like, determine how much you want to save for the holidays. If you’re planning to spend $1,000 on gifts, then that’s the savings goal you need to set.

Then, take that savings goal and divide it up over the months leading up to December. For example, if I want to start saving in February, that gives me 10 months to save $1,000 for gift-buying. Meaning, I must save $100 a month somewhere in the monthly budget of non-essential spending. The earlier you start saving, the easier it is to save. Here are some ways to save money.

Eat at Home vs. Going to a Restaurant

Going out to eat can put a strain on your wallet. To avoid big expenses on food, start meal prepping at home. Make your own sandwiches for lunch to bring to work and freeze leftovers to make your groceries last.

Cut Your Subscriptions

You may not think you have any subscriptions but go through your credit statements to see if there is anything you are missing. Is there a gym membership you aren’t using? Can you switch to home workouts or your community fitness center? Check to see if you are paying for any cell phone apps, magazines, game or movie rentals, software subscriptions, or websites like LinkedIn Premium, dating sites, Hulu, Netflix, or Amazon Prime. Cutting these services may be difficult but think of how much will add up over just a few months.

Go Minimal

Minimalism is a movement growing in popularity these days. For you, maybe this means cutting down on the non-essentials or simple luxuries. Skip buying coffee every day or getting your nails done or spending your cash on clothes. Find entertainment and activities you and your friends can do for free - go for a walk in the park or to the beach. Take a trip to the library and read a book. If you really want to save a lot of money quickly, consider a financial fast. Implement a “no-spending” weekend where you choose not to spend money for a few days.

Creating More Cash

If you’re struggling to find savings within your existing budget, then it’s time to consider new sources of cash.

Taking Advantage of Cashback & Rewards

Many financial institutions offer credit cards that include cash back on purchases or cash bonus offers for opening an account. Check for any credit card deals or checking account offers from local banks or credit unions.

Opening a Certificate of Deposit Account

Placing your money where you can earn a higher interest rate is an easy way to bring in more money. Check out what investment options you have available, including certificate of deposit accounts.

Additional Work Opportunities

If your job has overtime pay as an option, even working just a few extra hours a week can add a lot to your budget. Depending on your work schedule, finding a part-time job is another option.

Saving Money with Community First

If you’re looking for ways to save money for the holidays, Community First Credit Union offers a variety of savings and checking accounts. Our team can make recommendations based on your financial situation and budget goals. Contact a member of our team today and start saving.