Why It’s Even More Important To Stick to Your Holiday Budget This Year
The holidays are often a busy — and expensive — time of year. Americans are expected to spend $998 on items like gifts, food and decorations this holiday season, according to the National Retail Federation. And they’re getting started earlier. A recent Bank of America survey found two-thirds (65%) of consumers started preparing for the holidays by early October, with 31% having already purchased a seasonal gift.
We’ve Got You Covered: GOBankingRates’ Smart Holiday Spending Guide
Prepare: Shipping, Wrapping & More Extras To Account for in Your Holiday Budget
Though sticking to a budget is a good idea year round, you may need to be even more diligent as we head into the 2021 holidays. Julie Ramhold, a consumer analyst with DealNews.com, explained why.
Over the last several years, holiday sales haven’t been as lucrative. And that trend is expected to continue this year, especially due to shortages and delays caused by the ongoing pandemic. That means you could end up paying more for certain items than usual.
“Stores like Walmart, Home Depot and Target have all committed to chartering their own ships in an effort to have items delivered in plenty of time for the holidays to keep shelves stocked,” Ramhold explained. “Unfortunately, that also means more expensive shipping, which means they may not be able to offer the same low prices we usually see.” If discounts and sales are minimal this year, your purchases may eat into your budget more and cause you to overspend.
If you’re a last-minute shopper, you’ve probably come to rely on expedited shipping to ensure packages arrive on time for the holidays. This year, however, shipping delays are certain. Cargo ships have been backlogged in harbors around Southern California, which serve as entry points for about 40% of U.S. imports. Plus, the mad rush around Black Friday is expected to compound delays.
“Rather than pushing your holiday budget, stick with standard shipping,” Ramhold said. That will mean some planning ahead on your part, but it should be worth it.
The pandemic caused major disruptions to supply chains, leading to product shortages. And the Great Resignation has left many businesses struggling to find workers, too. Ramhold said these shortages are expected to continue into 2022, so it’s important to stick to your holiday budget now in order to deal with higher prices post-holidays as well. “The last thing you want is to overspend during the holiday season, only to find that standard expenses are even more after the start of the new year because we’re still dealing with limited supplies,” she said.
Important: The Ultimate Holiday Etiquette Gift Guide
How To Save on Holiday Expenses
Given the issues holiday shoppers are likely to face this year, it can help to trim down your holiday budget and make room for higher costs. Here are a few ideas.
Opt For Digital Items
Ramhold pointed out that unlike physical products, supply chain disruptions haven’t affected digital items such as ebooks and audiobooks, or downloadable video games, music and movies. “If you’re having trouble finding an item because of supply chain disruptions, consider opting for the digital version instead,” she suggested.
Embrace the Gift Card
Forget the stigma around giving gift cards. They tend to be more appreciated than you might think. For one, asking someone what they want for the holidays can be a bit awkward, especially if their desired gift is out of budget (or they really can’t think of anything). “A gift card to their favorite store is a great solution,” Ramhold said. “That means they can put the card toward something they want or need, and is more likely to be used than something that you think is a good product for them but actually misses the mark.”
Opting for a gift card can also help you stick to your budget since you don’t have to worry about finding an item that’s priced exactly within your spending limit.
Shop In Person When You Can
As mentioned above, shipping delays are going to be an issue this year. If you’re comfortable braving the crowds, shopping in person lets you avoid shipping costs completely. And even if you’re not, many stores are still offering curbside pick up, so you can still shop online and avoid going to the actual store to retrieve your items.