As the holiday season approaches, we can find ourselves swept up in the excitement of gift-giving, festive gatherings, and travel plans. While the joy of the season is present, it’s essential to approach holiday spending with a well-thought-out budget. At Alaska Air Group Credit Union, we understand the importance of financial wellness and want to help you navigate this busy time of year without breaking the bank.

The Importance of Budgeting

Before you dive headfirst into holiday shopping, take a moment to assess your financial situation. A well-planned budget can help you avoid the holiday overspending, and limit post-season debt. Setting a budget allows you to enjoy the festivities without the stress of financial strain.

Create Your Holiday Budget

The first step to preventing holiday overspending is to take a moment to assess your financial situation and create a budget.

1. Assess your current financial situation: Start by evaluating your income, expenses, and savings. Understanding where you stand financially will give you a clearer picture of what you can afford to spend this holiday season. Banzai, our financial wellness tool, can help you establish a budget with their virtual coach.

2. Set a realistic spending limit: Determine how much you can allocate for gifts, decorations, food, and other holiday-related expenses. Remember to consider expenses like travel or experiences that can also add up quickly.
3. Make a list: Create a list of everyone you plan to buy for, along with a budgeted spending amount for each person. This helps you stay organized and focused during your shopping trips.
4. Prioritize your purchases: If your list exceeds your budget, prioritize gifts based on necessity and sentiment. You might decide to make homemade gifts or plan smaller, more meaningful surprises.
5. Consider Alternative celebrations: The holiday season doesn’t have to revolve around expensive gifts. Think about alternative ways to celebrate, such as homemade gifts, Secret Santa exchanges, potlucks, or community volunteer opportunities.

Tips for sticking to your budget

• Shop early: Avoid the last-minute rush, which can lead to impulse buying. Planning ahead allows you to find better deals and stick to your budget.

• Look for deals: Keep an eye for sales and discounts. Many retailers offer early holiday sales, and using coupons can significantly reduce your spending. Allowing yourself enough time to shop around and utilize Black Friday, Small Business Saturday, and/or Cyber Monday deals that can save you in the long run.
• Track your spending: Use apps or a simple spreadsheet to monitor your spending. Visualization is key; this can help you stay accountable and adjust your budget if needed.
• Use cash: Withdraw your budget amount in cash. This can help you resist the temptation to overspend and keep you on track with your budget. Once the cash is gone, it’s gone!

After the Holidays: Reflect and Reassess

Once the holiday festivities have ended, take some time to review your spending. Did you stick to your budget? What worked well, and what didn’t? Reflecting on your financial habits during the holidays can help you plan for next year and improve your budgeting skills overall.

Looking for additional ways to save? Alaska Air Group Credit Union’s Christmas Club is a great tool to save money throughout the year. With a Christmas Club Account, you can contribute funds all year, and November 1st your spending money will be automatically distributed to you via check or deposit into your AAGCU checking account. Even a small amount each paycheck can help you budget better for holiday expenses!

Conclusion:

The holiday season should be a time of joy, not financial stress. By taking the time to budget before the holidays, you can ensure a more enjoyable experience for yourself and your loved ones. Remember, the spirit of the holidays isn’t about how much you spend, but rather the time spent with loved ones. Happy holidays!