Tis The Season To Be FRUGAL

November 8, 2007

Why is it that at the end of the year, generally referred to as “The Holidays,” all our financial principles and standards seem to fly right out the window? Many of us spend 10 months of the year saving and investing dutifully, carefully evaluating any purchases, eschewing credit card debt, and monitoring our budgets. Then when November rolls around, suddenly all our good habits go right out the window!

Suddenly spending becomes a completely expected and justifiable occupation. All free time is consumed with spending money–BUYING decorations, BUYING gifts, BUYING special foods and drinks, BUYING cards and knick-knacks, BUYING travel, and BUYING any number of other things that you would hardly even glance twice at, much less spend your hard earned cash on, during any other month of the year.

Sure, most of us need, want, or have to spend more money than usual during November and December. And that’s OK to some extent–especially if you plan for it and can afford it. You might need to travel to see family and friends. You may want to send out Christmas cards, purchase gifts, or dole out bonuses to any number of people in your life. You may even be roped into spending events you’d rather avoid–like one too many Secret Santas or Christmas Ornament Exchanges at work, school, or church.

But much of our spending at this time of year is wasteful and can easily be avoided. Do you really need a professional photographer to take your Christmas card photo? Must you buy a gift for all 11 of your closest co-workers? Will your guests truly appreciate (or even notice) that $16 pecan pie–in addition to the four other pies you already bought for Thanksgiving dinner? Does your 2 yr old really need a dozen gifts? Must you buy yet another cocktail dress for this year’s Christmas party? Are you even looking at any of the prices during your two month long spending frenzy???

I’m not going to give the same old “set a gift budget and stick to it” advice. I find it difficult if not impossible to project what kind of things I might need to buy during this time of year. But here are a few ideas that might help you out:

  1. Actually look at the price tag before you buy each and every thing for the rest of the year, whether you’re in the grocery store or a department store. Often there are substitutable items that cost half as much a few feet away. Choose them.
  2. Avoid items marketed for the season (this includes anything that depicts bells, snow, Santa, reindeer, turkeys, pumpkins, angels, etc). You may be tempted by the glittery holiday candles at Nordstrom which are running $20-$40. But you can get regular red and green candles from Target for $5 each instead. And will your display suffer? I think not.
  3. Don’t overspend on food. Have you ever been to a Thanksgiving or Christmas party that didn’t have at least as much food leftover as was eaten? Well, how about buying half as much in the first place? Also, if you’re willing to make substitutions (eat duck instead of Turkey, for instance) you can really save a bundle.
  4. Buy fewer gifts. Sure it’s fun to see kids tear into a pile of gifts every year. But all that does is raise the bar for the number you have to buy next year. And guess what they end up looking forward to each year? Not seeing their extended amily or even getting out of school, and especially not remembering the reason for the season–it’s gifts. You’re wasting money and spoiling your kids in one swift motion.
  5. Buy cheaper gifts. Here’s a secret: the gift wrapping is usually more important than the gift. Buy cheaper gifts and just wrap them up beautifully, especially when making purchases for kids and when buying things that no one will know the cost of. People will probably will abandon the gifts within a month anyway. Buy cheap!
  6. Make compromises with family and friends. If you have a large family why not openly set limits on who buys gifts for whom or how many can be purchased? I bet everyone at work would appreciate being relieved of the usual gift exchange; suggest it! Explain to your kids that you’re giving smaller gifts this year so that you can afford to make bigger contributions to their college funds. Why not take the kids shopping for a family in need rather than for each other?

There are lots of ways to save money this season, and so many opportunities to do so. Look at this as the easiest time of year to save! And please leave a comment and share some of your Holiday savings tips.

More from Meg at The World of Wealth

21 responses to Tis The Season To Be FRUGAL

  1. I’m not so sure about buying cheap. What about cutting down on the number of gifts you buy but purchasing something really high quality from a local artisan or shop — something that will really last and be memorable. As an example, my friend gave my son a small block of transparent plastic with a preserved wasp inside about two years ago. He still pulls that thing out and studies it now and then, while most of the other presents are broken or forgotten. Too often our eagerness to get something really cheap results in something that was made in a place like China that uses virtual slave labor and has little or no safety standards that we expect.

  2. I agree agree with Greg, but I truly think it is the thought that matters…not the price tag.

  3. Greg – If you want to get safe toys and products not made in sweat shops, I totally support that. But buying more expensive items doesn’t mean you’re doing those things, and buying cheap items doesn’t mean you’re not. And I’m not suggesting you replact gifts that are meant to be memorable, like one you might give to your spouse. I’m recommending the cheap strategy for small, obligatory gifts such as those for children, co-workers, kids’ teachers’, etc.

    SavingDiva – It’s certainly the thought that matters. So how do you explain buying designer gifts for small children who have no concept of cost or value?

    Note to all: By “cheap” I don’t mean faulty, dangerous, or of poor quality or value. I mean “less costly.” Kitchen utinsils and appliances from Target are often as good as those from Crate & Barrel. Lamps from Wal-Mart are often as good as those from Restoration Hardware. And no one can tell the difference if you wrap the lower cost version up nicely!!!!

  4. Timely post Meg … everyone is getting in the holiday groove with Thanksgiving only 2-weeks away. I got brave last year and approached my siblings (as you suggest in #6) and told them hubby and I were going to a bake-it or make-it approach to our holiday gift giving. We just had to get real about our finances with hubby’s retirement looming in the not so distant future. I am a children person, totally, and would just go overboard on my nieces and nephews. It would take me until June to recover from my extravagances. And you know what the kiddo’s loved the goodies I baked them last year. We had a super time, and I didn’t break the budget.

  5. I have done all six of those, and they really do make sense. Another thing I do is to buy gift cards. I’m tired of paying as much to ship a gift as I did to buy it. Most of my family would rather shop for what they want anyway. Makes the Holidays much less stressful.

  6. I think people almost get into a different mindset NOT knowing how much they are truly spending on credit cards.

    I think they have that mindset also that it’s ok because it’s the “holiday seaason” and everything will be ok in the next year.

  7. What about making gifts?
    We are making wine this year – a Christmas chardonnay – it should give us like 25+ bottles!

    nice – personable – home made – and delicious

  8. Duck instead of Turkey? I’m not so sure that’s cheaper per pound. Correct me if I’m wrong but I’m going to go out on a limb and say that it certainly is not, at least where I live. Turkey’s may mean leftover but that means turkey sandwiches for the next week!

    Of course if you are arguing that Turkey is more expensive on a bird to bird comparison then I will agree. Depends if you can use the Turkey or not. If not then duck works, but so does Cornish hens or a really nice chicken.

    Good article!

  9. I think if you can afford it then it’s fine to give gifts to those who will appreciate, need, or deserve it.

    We can afford it. We plan for it. And it hasn’t ever put us in a bind. We still give to charity during this time as well (actually feeding homeless people this evening and gave a chunk of money to ensure they have food for thanksgiving).

    Christmas should be no different than any other time of the year. If you can afford to be extravagant go for it. Helps the economy. If you can’t afford it, I can just about guarantee that no one will notice that did less.

  10. Great ideas.

    My wife’s 4 sisters and brother (and spouses have a gift exchange. $10 limit! Buying $20 of presents (2x$10) is better than buying for everyone (5 sibilings + 5 spouses x $10 = $100).

    Also don’t use credit cards this christmas. My wife and I froze our cards so we can’t use them. http://gettingaheadinlife.blogspot.com/2007/11/freezing-your-credit-aka-cold-hard.html

  11. This year my wife decided to have a dry run thanksgiving day to test out her recipes. We soaked the bird in a brine solution she got at William Sonoma it really kept it moist. OMG, the turkey was so good and I get to do it again in a few days!

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