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3 Common Mistakes made in Personal Holiday Budgets

Gift-giving during the holiday season can be overwhelming. We often consider this the single chance we have during the year to spoil our loved ones and remind them of how special they are to us. Before you know it, your holiday gift list goes beyond one page and you’re spending a small fortune – just because. In order to stay on track this holiday season, here are three mistakes that many fall victim to amidst the holiday hype.

Not setting a holiday budget

Did you sit down this year and determine how much you would spend on each individual? If you answered no, you’re not alone. People are often too engrossed looking at all the wish lists of their loved ones that they forget to take a logical, financial look at all their holiday spending. It’s easy to get sucked into gift-giving and splurging at all the stores in the mall, but it won’t leave your pocketbook very happy. In fact, on average, Americans rack up more than $1,000 in debt each year due to the holidays, according to a post-holiday survey. The report went on to say that most of these shoppers would not pay off the debt that accrued during the holidays in the next three months. Furthermore, 64 percent of participants did not plan to acquire debt during the holidays meaning that most of these shoppers did not have a holiday budget.

Not accounting for holiday dinners and get-togethers

As the holidays approach there are countless dinner parties and gatherings that you and your loved ones are invited to attend. Most of the time, you bring a gift for the host or a dish to share. We often pull out all the stops and make our famous and most decadent dish, usually one that requires expensive ingredients, or surprise the host with a bottle of wine. It’s fancy meals and gifts like this that continue to add up during the holiday season. If you designate a certain dollar amount to spend on food for your holiday meal and what you will spend contributing to other holiday parties, you’ll see that you spend significantly less, but still, have a jolly time.

Forgetting that less can be more

It’s easy to get swept up into the hype of surprising our loved ones with gifts not only from us but Santa and filling their stocking with goodies as well. Remind yourself that sometimes less is more during the holiday season. Instead of buying your loved ones several gifts, try focusing on purchasing one meaningful and thoughtful gift for them. Better yet, try your hand at making them a gift such as a scarf, quilt or a piece of furniture. Take the time to give them a gift they will truly enjoy instead of focusing on buying them a plethora of gifts that don’t mean as much.

In the same sense, try to narrow down your gift list. Instead of buying a gift for all of your coworkers, try to start a gift exchange where you will only have to purchase one gift. A popular holiday tradition is a cookie exchange, which is another cost-effective yet still festive tradition.

Having a holiday budget doesn’t mean you have to be a Scrooge this holiday season. Instead of focusing on spending more, focus on spending your money more wisely. If you take the time to realize how and where your money is spent, you’ll make better choices as to how, where and why you spend your money.


Rebecca Kempenich

VP of Marketing