The holidays should be a time for joyous celebration with the people we love, but they can often become a financial burden that leads to debt and overspending. Before you start your holiday shopping spree this season, create a spending plan so you can keep your finances in check and reduce your stress.

Build a budget

Mindful spending begins by building a budget. When creating a holiday spending budget, you need to include all the expenses that come with the season, including gifts, shipping, gift wrap, cards, decorations and travel. Keep in mind that your spending this year may be different from past years due to the pandemic – you might spend less on travel but more on gift shipping and wrapping from e-retailers.

Once you’ve put aside money to cover your normal expenses (housing, bills, etc.), make a list of all the holiday items you’ll need to purchase, and set a hard limit on the amount you’re willing to spend. Having a set amount in mind will make purchasing decisions easier, as you’ll be working within limits you’ve already established. With any budget, the most important rule is to stick to it! Establish a comfortable spending limit, and don’t go over it.

Purchase proactively

Just as the early bird catches the worm, the early shopper catches peace of mind. Waiting until the last minute leads to overspending as you’ll rush to buy things without putting enough thought into the purchases. Could you find this item for cheaper somewhere else? Does this retailer have a sale you’re missing out on? What if you need other items this place doesn’t have to complete the gift? These questions remain unanswered for the last-minute shopper, but the proactive purchaser takes time to research all of this and more. Price tracking tools, like Honey or SlickDeals, can help you find discounts and provide coupon codes for certain online retailers.

Starting early also allows you to easily save money leading into the holidays. Some might find it too early to set aside money in January for gifts to give at the end of the year, but the earlier you start, the easier the saving is. Setting aside just $30 a month will result in over $300 by the time you start buying. There’s no need for credit card debt when you already have the money set aside.

Choose heartfelt over high-priced

Spending lots of money doesn’t really express that you care about someone. A handmade or small-but-thoughtful item shows that you’ve spent time creating or brainstorming the perfect gift for this particular person. If your sibling loves baking, get them an inexpensive baking dish filled with your favorite recipes! Framing a sentimental photo, making a customized ornament or charm and knitting a comfortable scarf are all great DIY gift ideas. The possibilities for handmade gifts are endless, so consider each person on your shopping list carefully, think hard about their interests, and try to put together something on your own that they would love. Even if the gift isn’t a smash hit, the time and effort put into it are priceless.


The holiday season is a time to express how much we love and care for the people in our lives, but you shouldn’t feel stressed to break the bank to do so. By following this holiday spending plan, you can avoid the pressure of overspending while still enjoying a heartfelt and happy holiday.