The holidays can be a magical time for parents, but they can also lead to overspending and credit card debt. Everyday essentials like groceries and gas can add up. And as a ripple effect, you may have to cut back on holiday spending to afford those end-of-year expenses like presents and travel.
For Jenni Sisson, a 41-year-old Salt Lake City freelance writer, money will be tight this holiday season. Between buying a new house and paying for both home and car repairs, she's setting different expectations for this time of year.
Last Christmas, Sisson spent $1,400 on gifts, food and travel, but this year, she has lowered the budget to $1,000. Even though prices are up year-over-year, this amount will cover gifts and food for her family of seven and her extended family.
How? By making trade-offs. Sisson isn't the only one looking for creative ways to stay on budget this holiday season. A recent CNET survey found that 72% of US adults are making trade-offs and sacrifices to afford the holiday spending season.
Making tradeoffs during the holiday season isn't always fun, but it can prevent credit card creep. Here are the three tips Sisson is following to afford Christmas for her five kids, without overspending.
Read more:Â Don't Fall Into the Same Debt Trap This Holiday Season. 3 Tips to Break Free
Make or bake presents for teachers
Sisson has five kids and plenty of teachers to buy presents for this time of year. Instead of going with mugs and gift cards that many teachers get, Sisson is baking homemade bread. This helps her save money while still thanking the educators in her kids' lives.
"Most people love a loaf of fluffy, homemade bread," Sisson says.
If breadmaking isn't your thing, you could bake holiday cookies, brownies or other sweet treats. You also don't have to spend more than the cost of a card. You could write a handwritten note thanking a teacher for the impact they've had on your child or recalling a fun memory your child has from class.
Shop thrift and vintage stores
CNET's survey also found that 14% of US adults are buying secondhand or thrifting. Sisson is doing the same. She often buys presents for her little ones secondhand, a tip she recommends for other parents on a budget.
"If you have little kids on your list, your child won't know if the toy is from the dollar store or is secondhand," Sisson says.
You can also find vintage clothing, vinyl records, books and older tech at secondhand stores, which Sisson noted are trendy with the older kids right now. You can shop at your local thrift stores or try online marketplaces like eBay, Poshmark or Mercari.
Try this unpopular credit card point strategy
Most credit card experts recommend redeeming your credit card rewards for travel to maximize the value of your points or miles. You usually get the most value per point when you redeem them towards travel, especially with premium travel cards that can offer more than 1 cent per point back. During the holidays, however, it could be helpful to ignore this advice and instead look at how your credit card points can help you stay on budget.
While Sisson knows she'll get more value out of her points by redeeming them for a trip, she plans on using her My Clients Love My 5% Cash-Back Savings Challenge. Here's How It Works toward gifts and other holiday expenses. Many card issuers let you cash in your points for gift cards, cash back or use them directly through the issuer's shopping portal. Sisson knows she might get less value per point, but it will help her stay on budget.
Even if you're making trade-offs to keep your finances on track, there are still plenty of ways to celebrate and give gifts. You may try budget-friendly gift-giving options or check out what one of our go-to experts recommends to avoid gift guilt altogether. And if you need to travel or there are still ways to save money on the holidays without missing out.
More holiday budgeting advice
- Steal These Money Expert's Tips for Cutting Holiday Costs
- Need More Money for the Holidays? Here's How to Get It
- These Budgeting Apps Make Holiday Gift Buying a Breeze
