Best Practices to Saving Money for the Holidays

October 22, 2018



















It is never too late to start saving money before the holiday season sneaks up on you.  When it comes to saving money, you need to review your spending habits over the last few months.  This can be an ambitious task but it is a realistic one you shouldn't shrug off.  Here is why.


There are several reasons households overspend during the holiday season.  For example:

  • Last minute purchases (Food, Gifts, Travel)

  • Higher Utilities (Water, Electricity, Gas)

  • Lack of Budget Projections


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You may be good at building a budget but you may be failing to account for items that spring up, especially after Thanksgiving.  This is because when you think you had purchased all your holiday gifts and stocked your shelves with enough food to feed four families, you are informed that some additional guests are coming over.  To help them feel welcomed and invited, you usually go out of your way to make them feel like part of the family.


This last minute change can be a gift, one's favorite dessert, additional travel to another family member's home.  


With additional guests in your home, you can bet more showers will be taken, more laundry, more cooking, etc.  Because of these spring of the moment situations, these are reasons that budgets fail during the holidays.  You just simply cannot account for everything.  Or can you?


The first rule is to not map out of a budget that you cannot meet.  This sounds obvious but more often than not, households show their willingness and ambition to get their finances in order only to fall short.  Nothing can be more defeating than failing at your own money management.  Such failure is usually due to inaccurately budgeting each line item appropriately.  Another reason is not accounting for unexpected expenses that may arise.  As mentioned earlier, the holiday season is notorious for this. 

Between now and Christmas is the time to really buckle down and conduct a thorough analysis of your spending habits.  


Analyze Your Spending


When reviewing your bank history over the last several weeks, analyze to see where the "non-budgeted" money was spent (i.e., last minute coffee shops, vending machine, sale item from the store that wasn't on the grocery list). 


Next, take a look around your home for items you have purchased recently.  This is to recognize name brands from the toothpaste you brush your teeth with to the coffee of your choice.  Your loyalty to key brands may need to take a back seat for a few months.  Don't worry--it's temporary!  By switching name brands to store generics, you can usually save anywhere from 20-35%, sometimes more! 


According to the United States Department of Agriculture (USDA), "Over a third of the U.S. food dollar is spent on eating out services" as of 2016.

The average monthly cost on groceries for a family of two is $385.77 compared to $623.68 for a family of five.  While these figures may seem low, it is also misleading if you fail to consider the amount of money you eat when you are not at home.  In the USDA, Economic Research Service, Food Expenditure report, we can see that Americans are now eating away from home than at the kitchen table.  


The Bureau of Labor Statistics claims Americans "spend $4,049 of food at home and $3,154 on food away from home".  Even by summing these up and calculating a monthly figure, we get approximately $600 month on food. 


A great way to lower your food bill is by meal prepping and planning your week.  With a plan, you are more likely to stick with it, odds increase if you write these goals down.  I recommend using an affordable meal plan product to get you started.  You can try the money saving tips for FREE for 14 days and receive healthy meal tips.  $5 Meal Plan makes it simple and easy. 


One of the founders, Erin Chase, was having problems making meals for less than $5.  So she helped to design a variety of meals such as 6 Weeks of 30 Minute Meals, 6 Weeks of Slow Cooker Meals, 6 Weeks of Vegetarian Meals, and many other plans.  Take advantage of the Free Two Weeks!


If you are having issues staying on track with your budgeting then I would recommend you sign up a for a free account on  While the website does a paid for service as well which links your bank's account to track your spending habits, it does offer a free subscription as well that you can use to budget your finances on a month-to-month basis.  I also recommend you pick up one of our Budget Templates exclusively on Etsy for less than $2. 


Build a Sinking Fund


To help mitigate unknown expenses and breaking your budget over these next couple of months, I recommend you set up an account to start saving some money.  I have a few options that have worked well for me.  First, set up a free checking account, not savings, but a checking account because you will be pulling money out of this account within the next 30-60 days.  You can open up a FREE checking account with USAA whom I trust with my money.  With each paycheck or money you earn, start putting some away into the account. 


The other source I recommend is Qapital to save money because the company makes saving money easy and simple.  How Qapital works is based on your spending and the rules you set up in the app.  For instance, if you set up a rule to round each purchase to the nearest dollar, Qapital will deposit the difference of your purchase into an escrow account.  When I set up a rule, my purchase for a cup of coffee is $2.54.  The difference of $0.46 is sent to an escrow account.  These little savings add up fast and you can deposit this escrow amount into your regular checking account at any time you desire.  It is a great way to build up savings with minimal impact on your budget. 


Shop Around 


Now is the time to start shopping around for gifts.  Waiting until the month of December really hits your monthly budget hard for that particular month.  By spreading out purchases over the course of a few months, you can build your savings and limit the large volume of purchasing during the holidays.  Amazon is great for its Free Shipping but I also wrote a blog article on its competitors that I recommend you read as well, 6 Online Shopping Sites for the Holidays".   


Because of the chaotic season approaching and trying to stay organized, you should get a budget planner.  I like the Your Balanced Budget (Monthly Planner) and currently, it is under $10 with Amazon. Check it out!


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