Set a Holiday Budget


In my family, we are no sooner past Labor Day BBQs when talk turns to who will be hosting which holiday dinners, whether we will be exchanging gifts across the board or doing Secret Santa, and who wants what. Rather than dreaming of dancing sugar plums, I dream of dollar bills vanishing before my eyes as I’ve been known to get overexcited — a euphemism for overspending — now and again. This year, though, I’m committed to staying the financial course. So, I turned to some of my favorite money minds and asked for their best ideas for managing holiday spending, so you can keep track of yours, too. Here’s what they said.

1. Set a holiday budget, but think creatively. When determining how much you can afford to spend this holiday season, don’t just consider gift purchases but also wrapping and shipping costs, as well as holiday cards, decorations, parties, entertaining, tips and travel. Carmen Wong Ulrich, Industry Professor, Finance & Risk Engineering, NYU PolyTech, puts “pen to paper” as early as September to get a rough idea of what she can afford to spend on gifts after she factors in these other costs. The earlier you start budgeting, the more time you have to save up. And, as the GoGirl Finance team noted, budget constraints can lead to more creativity, so let your creativity shine through!

2. Determine your gift-giving strategy. Manisha Thakor, Founder of MoneyZen Wealth Management says decide if you are going “shallow & wide” (i.e., giving small gifts to a lot of people) or “narrow & deep” (i.e., giving bigger “oh-wow” gifts to just a few people). The worst thing you can do, Manisha says, unless you have an unlimited budget is go “wide & deep.” A strategy is important because it gives you a touchstone against which to evaluate potential purchases. The GoGirl Finance team made a great point: communicate your strategy to family and friends to manage expectations.

3. Make a list. Once you have a strategy and a budget, then make a list of the people you want to buy for and allocate how much you can afford per person, advises Stacy Francis, CEO of Francis Financial. Ulrich agrees, adding that this is the point to decide whether you will spend more on the children in your life versus the adults, or more on family members versus co-workers. Another must-do from Stacy: keep your list with you as you shop and track your spending.

4. Verify before you buy, when it comes to gifts for children, says Jonathan Clements, Director of Financial Education at Citi Personal Wealth Management, in How to Spend Smarter This Holiday–Without Being a Grinch. Ask your children to draw up a wish list — and then check back a few weeks later to make sure their wish list hasn’t changed. As many parents discover, kids are often desperate for a new toy one day, only to lose interest a few weeks later.

5. Shop when and where it counts. Take advantage of Black Friday, Cyber Monday and online and offline retailer promotions when you shop, says Andrew Schrage, co-owner of He noted that some retailers offer in-store pricing on their websites and sometimes the deals are even better. Many online sales start before Black Friday and Cyber Monday, so consider signing up for deal-sharing websites like FatWallet to receive email updates on the best pricing for the gifts on your list. When shopping online, Adam Riemer, a contributor to, says to bundle your purchases on a single website to qualify for free shipping. And, for high-ticket items on your list, Adam visits comparison shopping sites like or Nextag before he buys.

6. Stick to your mission, says Jonathan Clements. “The idea is to purchase gifts for others, not stuff for yourself.”

7. Consider gift cardsShelley Hunter  aka the Gift Card Girlfriend. Not only does it save hours spent shopping for the “perfect” gift only to end up empty-handed, but you are more likely to stay on budget — and gift cards are tax-free. Because the dollar value of the gift is revealed to the recipient, you may feel pressured to put more money on the gift card than you can afford. Don’t, says Shelley. “Pick a gift card amount that works for your budget then select a gift card  that can be easily redeemed in that amount. For example, a $10 gift card may cover two trips to the ice cream store, but will be difficult for the recipient to use at a clothing store without paying additional money.” I’m a huge fan of gift cards. Rather than buy them with cash, I redeem my Citi ThankYou® Rewards points at for assorted gift cards in various denominations which I use for stocking-stuffers and “main” gifts.

What are the steps you take to manage your holiday spending? Are there any particular pitfalls you struggle to avoid?

Linda Descano serves as a Managing Director and Head of Digital Partnerships, Content and Social for North America Marketing at Citi. In this role, she is responsible for creating and delivering competitively differentiating consumer engagement experiences in digital and social channels to drive brand health and business goals. Linda is also President and CEO of Women & Co., a service of Citi that brings women relevant financial content and thoughtful commentary to get them thinking and talking about money. 

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