4 ways to embrace frugal holiday spendingDec 11, 2020
Are you stressed about holiday spending this year? A lot of people are feeling uncertain about their financial situation right now. Too many households continue to struggle with affordability in the wake of COVID-19. In light of this, is it wrong to be frugal this holiday season? Spending money you don’t have is risky financial behaviour. Overspending during the holidays at the end of a tough year is never a good idea. But let’s be real: sometimes holiday spending can get out of hand. And extravagance can be particularly difficult if social pressure is compelling you to ignore the one gift you should be giving yourself this year: an honest holiday budget that can get you through the season debt-free.
What is frugal spending?
Think of frugal spending as about being mindful with your money. A frugal person spends carefully, compares options and prioritizes their needs and wants based on what’s most important to them. Frugality is less about spending less and more about spending wisely.
How to embrace frugal holiday spending
1. Avoid social pressure
The holiday season offers a perfect opportunity to relax and enjoy time with family and friends. Worrying what other people think of you and the gifts you buy is definitely not relaxing. It’s no secret that gift giving can be a social contest. Are you buying presents for people at work? Your kids’ teachers? Your neighbours who live three doors down? These can be very nice gestures. But ask yourself: who are you really buying for? Them or yourself? If you had to give the gift anonymously, would you still be buying it? For an interesting point of view on gift etiquette, here’s one on “gracious gift giving” from TheSpruce.com. Rather than thinking about what other people are doing, try to do the best you can with your own holiday budget.
2. Don’t be cheap, spend frugally!
One common misconception is that being frugal is the same as being cheap. Nothing could be further from the truth. Frugality isn’t just about your wallet. Believe it or not, you can find satisfaction, freedom and even joy in living a frugal lifestyle.
But this doesn’t change the fact that frugal living isn’t often associated with the generosity of the holiday season. Frugality doesn’t mean seeking the lowest possible price, at whatever the cost to your friends, family or sanity. It’s about getting the most out of your money by doing your homework, and practicing mindful spending. In other words, be conscious of what, how and why you are spending your money. This means that every gift should undergo a process: comparison shop, read customer reviews and take advantage of a retailer’s price matching policies.
If things are particularly tight this year, as they are for a lot of households, don’t be afraid to open up to your friends and family about your worries, finances and spending plan. If you aren’t able to meet certain holiday spending expectations, sharing your concerns can help you stick to your budget. Drawing names instead of buying gifts for everyone, getting gifts only for the kids, and contributing to the holiday dinner are all affordable ways you can give without piling on credit card debt. Chances are you are not the only one with holiday spending stress.
3. Make informed spending decisions
Being frugal means making informed decisions. One of the quickest ways to increase holiday spending worries is by going online, scrolling through website after website, not knowing what you want to buy. The sheer misery of this scenario is enough to push the most rational spender into buying whatever, at whatever the cost. Don’t do it! Instead, take the time to think about what the recipient would truly appreciate. Brainstorm within a set budget amount. Track your expenses. Why not consider adding a column to your holiday budget for a variety of ideas that you can mull over?
Once you have a good idea of what you want to buy, online shopping or curbside pickup can provide significant stress relief. If you can shop in-person in your province, do an inventory check before you go to the store to make sure the item is in stock or call ahead. Still stuck? If you’re wondering what gifts to get for your kids, or your friends’ kids, try discussing the popular “4 gift rule”. FrugalRules.com gives a variety of variations on the “4 gift rule” for kids of different ages to avoid overspending.
4. Give gifts of time and charity
Are you buying for someone who already has lots of stuff in their life? Giving the gift of time can be a very thoughtful and affordable way to help them out. Time is precious. If you have a family member who has no time to cook, consider dropping off a few freezer-friendly meals. A friend who is simply overworked and over stressed? Write them a card and make your time official: offer to shovel them out after the next big snowfall. Organize an online or in-person get-together with your friends. The ideas are endless.
You might also consider giving your friends and family the opportunity to participate in an act of charity. But be careful. It’s important the charity speaks to the recipient and their values. Again, do your research to best match the organization with what they really care about. Ideally, it should be a cause or an organization that’s already on their radar. If you’re able to hone in on your loved ones’ sense of humanity, this is a wonderful thing.
For more holiday spending tips and advice listen to our new holiday spending podcast.