I read an astonishing statistic the other day. A recent poll revealed that 85% of Americans “sometimes” feel stressed about money and 30% are “constantly” stressed about their financial situation.
I guess I shouldn’t be surprised. I know I fall into that 85% category, and especially when the holiday season rolls around. With gift giving, parties, big dinners, and travel, holiday costs can add up quickly.
In my recent post about reducing holiday stress, I learned I’m not alone. It seems that finances are one of the biggest holiday stressors for many of you wonderful readers.
In fact, I heard from so many of you that I decided to dig deeper into this stumbling block and offer my five favorite tips to reduce holiday financial stress this season.
Are you ready? Let’s do this!
How to Avoid Holiday Financial Stress: 5 Simple Tips
1. Set a budget
Yes, this is an obvious suggestion, but it is also one that’s often overlooked. Many of us feel pressured to find the best gifts, host the fanciest parties, and “go all out” when it comes to the holiday season.
If you’re looking to reduce your holiday financial stress, however, I’m here to tell you that it’s time to set a budget. Review your current financial situation, consider your regular expenses, and decide how much you’re willing to spend on gifts, entertainment, food, etc.
I recommend breaking down your expenses into categories and assigning each one a specific dollar amount. If you’re really feeling ambitious, withdraw that specific amount of cash for each category; when it’s gone, it’s gone.
2. Talk with your family
While money may feel like an uncomfortable topic of discussion, it doesn’t have to be that way. Talk openly with your close friends and family (those with whom you usually exchange gifts) and let them know you’re following a budget this season.
By setting expectations early on – for both you and your family – you reduce the stress of worrying about whether you’re spending “enough.” Instead, you can focus on what’s really important: time with those you love.
3. Choose affordable (or free!) holiday activities
Though advertisements may suggest otherwise, remind yourself that spending time with those we love doesn’t have to be expensive.
Yes, there are MANY wonderful holiday shows and experiences that cost a pretty penny, but there are also some incredible activities that you and your loved ones can enjoy for free.
In fact, my most favorite childhood memories during the holiday season were driving around looking at Christmas lights and sledding down the giant hill in my backyard. With the latter activity, I’d sled down that hill all day long and when it got dark, I’d head inside and warm up with a big cup of hot cocoa. (We’d always have the Swiss Miss packs with the mini marshmallows in them; seriously, it was the best.)
Admittedly, dehydrated marshmallows might not be at the top of your holiday activities list (to each their own😉) Nevertheless, I think you get the idea. Spend some time brainstorming affordable activities that you and your family love to do, and then schedule a time to do them. It’s as simple as that.
Feeling stumped? Here are 10 fun (and free) holiday activities to do with your loved ones:
- Go sledding
- Look at holiday lights (create your own holiday lights tour!)
- Bake cookies
- Have a holiday movie marathon
- Go caroling
- Make gingerbread houses
- Attend a holiday school performance
- Make holiday cards and send them to soldiers overseas
- Read your favorite holiday books
4. Cut back in other areas
It’s especially helpful during the holiday season to be mindful of where you’re spending extra money. Are there any non-essentials on which you can cut back?
During the holiday season, I try to keep dining out, shopping, and extra entertainment to a minimum. Do I stop completely? No. But I am more conscious of where my money is going. It helps me keep my spending in check and reduce unnecessary financial stress.
For example, if you make coffee at home throughout November and December, rather than buying a $5 latte before work each morning, that’s $200 you can put toward your holiday expenses. What a simple shift!
Need more ways to save money? You got it.
Look into carpooling to work; this would save on gas money and help the environment! Double win!
You might lower the thermostat; according to Energy Saver, you can save anywhere between 5%-15% on your energy bill by turning down the temperature a few degrees when you’re away from home or snuggled in bed.
By finding extra ways to save your pennies throughout the holiday season, you help relieve the pressure of the extra money going toward gifts, travel, entertaining, etc.
5. Shop Smart
You’ve set a budget, you’ve established expectations with your friends and family, and you’ve identified fun and affordable holiday activities. Now it’s time to shop smart!
I am an online shopper through and through, and when the busy holiday season begins, I love it even more. You simply can’t beat its ease and convenience. Plus, now that so many local shops have an online presence, it’s easy to support small businesses, too!
If you’re a fellow online shopper, then I have great news for you. There are so many incredible resources out there to help you get the most “bang for your buck.” Here are some of my favorites to help reduce holiday financial stress when shopping online.
Rakuten (formerly known as Ebates)
One of my all-time favorite money-saving websites is Rakuten. I’ve been using it for years, and it’s SO SIMPLE.
All you need to do is create an account, shop at your favorite online stores, and you earn a small percentage back on all of your orders. That’s it! Seriously; it’s like free money!
You’re paid quarterly by check or deposit. I have mine sent directly to my PayPal account.
As you can see in the image above, I haven’t done much shopping this past quarter. Nevertheless, I’ll still be getting almost $20 deposited in November for shopping at my favorite stores. Yes, please!
Want to give Rakuten a try for yourself? Great! You can sign up for free here!
There are also some great grocery apps available out there. My favorite is Ibotta, which allows you to take a photo of your receipt, upload it to the app, and receive cash back on different purchases. So awesome and so easy!
There you have it, friends! My 5 favorite ways to reduce financial holiday stress. As a quick recap:
- Create (and FOLLOW) a budget
- Set expectations with family and friends
- Choose affordable holiday activities
- Cut back on non-essential spending
- Shop smart
What are your favorite ways to reduce financial holiday stress? Share your tips below!