Preparing for Holiday Spending

‘Tis the season for holiday cheer, from November to December, a joyful end to the year. But, according to a survey by NerdWallet®, it’s also shaping up to be an expensive end of the year for 82% of Americans who plan to buy gifts for the holidays.1 Their survey found that the average gift-buyer plans to spend $1,107 on presents, an increase of $182 from 2024. And that’s just the gifts.  

45% of Americans are also planning to shell out for hotels and flights, spending an average of $2,586. If those numbers don’t have you feeling particularly jolly, we understand. As much fun as this time of year can be—reconnecting with loved ones, sharing a spirit of generosity and good cheer—the potential costs can be downright chilling. Further, overspending can take you off track if you’re trying to save up for a big purchase. 

That’s why this year, we’re here to offer some helpful tips on how to make holiday spending a bit more manageable. In this article, we’ll talk about setting a budget, making a list, and being proactive about your spending this year.

Set Your Holiday Budget

If possible, start preparing for this year’s holiday spending by reviewing last year’s spending. You might not have receipts, but you could potentially review your bank statements or credit card bills instead. This will help you get a clear picture of how you spent your money last year—and maybe some areas in which you could have held back a bit. Feel free to use this information as a starting point for this year’s budget. 

Of course, a lot can change in a year, including inflationary price increases and your own financial situation. So, with an understanding of how you’ve spent previously and what your current finances look like, start working on your new holiday budget.  

Ideally, this budget will cover gifts, travel, and other relevant holiday expenses, such as those related to hosting. Set whatever budget makes most sense for you, but it could help to try to strike a good balance between being too frugal and too generous.  

The NerdWallet® survey mentions that 15% of 2025 shoppers expect to spend more on gifts than they can comfortably afford. By setting a clear, effective holiday budget based on your financial situation, you might be able to avoid that!

Make a Shopping List (and Stick to It)

Another helpful way to prepare for holiday spending is to plot out who you’re buying for and what you can afford to buy within your budget. Then, write out your list, and do your absolute best not to stray from it. That can be challenging, of course.  

Many of us want to be extra generous during the holidays, and there will be no shortage of eye-catching products, deals, and displays while shopping. Still, steer clear of impulse purchases. If you do buy outside of your list, be sure you still track that in your budget.

Look for Deals

I know we just warned you about eye-catching deals, but it’s worth taking some time to search for good deals, especially before you head to the store or fill up your digital cart. Don’t be afraid to compare prices across different outlets to help you get the best bang for your buck. Look for coupons online, in print sources, or even in mobile applications for the various stores you shop at.  

This also applies to your travel expenses! Flights and hotels are often more expensive around the holidays, so start looking for those as soon as possible. It may be hard to find a great discount for flights and lodging, but you never know. Maybe you’ll luck into a holiday miracle.

Be Mindful of Credit Usage

The previously mentioned NerdWallet® survey noted that 31% of 2024 holiday shoppers and travelers have unpaid credit card balances from last year’s spending. High interest debt, as is often the case with credit cards, can be difficult to pay down. If you plan to use your credit card this year, consider sticking to just one. That could make it easier to keep track of spending.  

If you have lingering credit card debt from last year, it may be wise to bake a plan to pay that off into your holiday budgeting. While it can sometimes be easier said than done, it is typically wise to avoid spending more on a credit card than you can pay off on the first full statement.

Track Spending

We’ve hinted at this a couple of times in this article, but once you’ve prepared for holiday spending, it’s a good practice to start tracking it. If you don’t know what you’re spending, it’s very easy to spend too much. Tracking your spending and inputting it into your holiday budget can be tedious and, admittedly, is not exactly teeming with holiday cheer. But you’ll thank yourself later when you’ve found creative ways to stay within your budget this year.  

Don’t Wait Until December 

Start budgeting for the holidays as soon as possible, so you can start shopping, too. Once December rolls around, the shopping frenzies will likely kick in at the brick-and-mortar stores. That kind of environment plus the stress of finishing your shopping can lead to some impulsive decisions that you might regret in the new year.

Plan a Post-Holiday Spending Review

Finally, mentally prepare yourself, and maybe even set aside some time, for a post-holiday spending review. Take stock of how well you stuck to your budget and assess whether it was actually set at an effective number. Perhaps you had more room to spend than you thought. That’s something you can consider when you’re budgeting for the holidays next year.  

While you’re deep in your spreadsheets, this may also be a great time to start planning for next year, too! You could use this time to build a budget that helps you pay down debts and potentially even open up more space for the holidays next year.

Have a Happy Holiday Season!

Remember, you do not have to spend a lot of money to have a joyful holiday season. The size of your budget is less important than the warmth and care you share with those you love. Whether you’re planning to spend a lot or a little, we hope these tips help you prepare for holiday spending with more confidence. Have a wonderful holiday season! It goes by fast.