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How to Shop for Gifts on a Budget

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Jenny Hoff shares five tips for buying holiday gifts on a budget.

By Jenny Hoff, Headshot courtesy of Jenny Hoff 

One of the best things about December is the sense of total abandon. It’s a time to forget the rules and indulge in food, parties and shopping. After all, January is right around the corner and that’s when the no-fun resolutions come into play. The only problem is that while shedding those easily earned holiday pounds can be tough enough, the holiday credit-card bills are a little more difficult to make disappear. Studies show the average American accrues almost $1,000 in credit-card debt during the holiday season. If your credit card has an interest rate of 15 percent and you make just the minimum payments of $25 per month, it will take you 10 years to pay off this one holiday season, with an extra $400 in interest tacked on. Talk about dampening the holiday cheer!

So, before you start ringing in the season with the swipe of your credit card, check out these tips for celebrating without busting your budget.

1. USE PREPAID CARDS.

Countless studies have shown people spend more when using a credit card. And as we evolve from physical cards to mobile payments and one-click purchases, the barrier to spending completely disappears, causing most of us to end up spending much more than we intended. While sticking to cash this month could work as a solution, it’s unlikely to work in all circumstances. After all, who still shops in person? Come up with a realistic amount you’re able to spend with the money you have right now and buy a prepaid credit card for your holiday spending.

2. SIGN UP FOR A NO-INTEREST CREDIT CARD.

If you don’t have the cash on hand to support your holiday expenses but aren’t willing to sacrifice the spending, consider signing up for a card offering 12 months or more of no interest. But beware: You still have to make your minimum payments on time and once the grace period is up, a high interest rate will kick in, so make a plan to get those charged purchases paid before interest comes calling. Studies show the average American accrues almost $1,000 in credit-card debt during the holiday season.

3. OPT FOR SMALL AND MEANINGFUL INSTEAD OF BIG AND EXPENSIVE.

In an age when anyone can get almost anything they want with the click of a button, big gifts have kind of lost their luster and thoughtful presents are back in style. For instance, is there a quote that resonates with someone you love? Consider having a graphic-design company like Canva put it on a beautiful background. Then get it printed and adorned in a funky frame from a thrift store. Or if you have a friend selling essential oils, support her business by purchasing some oils to create your own bath salts, which you can pack in cute Mason jars and gift to friends and family. If that’s not in your wheelhouse, make a fun photo book with your best memories together throughout the year. Since all of us have mostly digital photos now, a physical book of memories is a gift most people would treasure.

4. USE A SAVINGS APP.

There’s no need to sift through sale racks or go from store to store to find the best deal. There are plenty of apps you can download that will let you know where you can get the best price for what you’re looking for or get you cash back for every purchase. Honey is a great app that automatically applies coupon codes when you purchase something from an online retailer. If you plan to host some parties and dinners this month, check out Ibotta, an app that offers cash back on your grocery purchases.

5. SET LIMITS AND MAKE LISTS.

Check in with friends and family, and consider agreeing to a gift-spending limit. And while you’re at it, encourage everyone to make a list of some gifts they would love within the set budget. The Christmas List app lets you share your list with family and friends, and people can even claim a gift so you don’t receive duplicates. Don’t worry about taking the magic out of gift-giving. Less shopping stress for all means more time to delight in the joy of the season.

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