Small Steps to Manage Holiday Spending

December 2024

Barbara O’Neill, Ph.D., CFP®, AFC®
Distinguished Professor and Extension Financial Management Specialist Emeritus
Rutgers Cooperative Extension

The National Retail Federation (NRF) predicts that holiday spending in 2024 will be between 2.5% and 3.5% higher than 2023. However, it is likely that inflation is at least a partial cause. Many holiday-related items simply cost more than they did previously.

Many Americans are feeling squeezed by high costs for food, utilities, housing, insurance, and more and are aiming to spend less this holiday season. Below are over two dozen ways to reduce holiday spending in five common holiday spending categories:

Gift Giving

1. Set a total gift budget and allocate specific amounts per person
2. Organize a Secret Santa or gift exchange so each person buys just one gift instead of many
3. Consider regifting new items, but only if they match recipients' taste and have not been seen publicly before
4. Make a non-gift agreement with friends or family and focus on spending quality time together instead
5. Redeem credit card rewards points for gifts, gift cards, or digital gift cards so there is no out-of-pocket cost
6. Gift experiences (e.g., movie tickets) or homemade gifts (e.g., baked goods) instead of physical gifts

Holiday Meals and Entertaining

1. Organize a potluck get together and ask guests to bring a meal item and/or beverage to share expenses
2. Buy non-perishable items like canned goods, packaged foods, and frozen items when they are on sale
3. Limit alcohol expenses by providing water and a couple of signature drinks or asking guests to BYOB
4. Plan a detailed menu for meals to avoid over-purchasing food and don't go "over the top" with food choices
5. Cook from scratch instead of using pre-packaged or prepared foods or a catering or meal delivery service
6. Reduce meat expenses by focusing instead on stir-fried entrees, vegetarian options, or small meat portions

Decorating

1. Visit a thrift store to purchase gently used decorations and tree ornaments at a fraction of their retail cost
2. Shop for holiday décor on online marketplaces such as eBay and Facebook Marketplace
3. Shop after-holiday sales to stock up on decorations (and holiday cards, gift wrap, and gift tags) for next year
4. Repurpose household items like mason jars and glass vases and fill them with ornaments, pinecones, lights, etc.
5. Swap holiday decorations temporarily with friends for a refreshed look without spending any money
6. Wrap empty boxes as faux gifts that can be placed under a tree or around your home as decorations

Holiday Travel

1. Book flights early and travel midweek (e.g., Tuesday, Wednesday) instead of on weekends for the best fares
2. Travel before or after holiday peak travel dates to avoid high prices due to supply and demand
3. Stay with family or friends to save money on hotel, Airbnb, or Vrbo accommodation costs
4. Pack snacks and drinks for road trips and snacks for airline travel to avoid expensive airport food
5. Use accumulated points or miles to save on hotels or airlines when there are no blackout dates in effect

Holiday Cards and Gift Wrap

1. Send personalized digital holiday cards to save on card purchases, printer ink, and postage
2. Reuse gift bags, bows, wrapping paper, ribbon, and gently used tissue paper from previous years
3. Skip cards on gifts and instead label gifts with a stick-on tag or writing directly on the wrapping paper
4. Repurpose old holiday cards to use as gift tags or postcard-style cards
5. Purchase holiday supplies from dollar stores, thrift shops, or flea markets