A Summer Guide to Holiday Savings
It’s July, and while your thoughts may be on road trips, backyard barbecues and ice-cold drinks on hot summer days, it is also a great time to think about the winter holiday season. Preparing a budget for your holiday spending can keep your financial wellness on track into the new year. In this blog, we’ll discuss how to plan for those expenses now so you can remain focused on the seasonal celebrations later.
Why Does Saving Early Matter for Holiday Spending?
The holiday season brings additional expenses that your normal budget may not have accounted for. Creating a budget for these extra costs in July gives you an idea of how much you’ll need to save each month to be ready for the holidays without overspending or borrowing money.
Saving money regularly is a great financial habit to develop. Travis Credit Union’s Knowledge Base offers free online courses on a variety of topics, including lessons on Saving for Goals and a Savings Growth Tool that helps you determine how much you should be saving each month. A strong savings plan also gives you peace of mind because you’ll be better prepared for the holiday season.
How Can I Reduce Holiday Financial Stress?
You can reduce your stress about the holidays by getting a clear picture of your finances. Start by evaluating your monthly income against your debt and expenses to determine how much money is available for savings. Then, seek out the right financial institution and savings product that can help grow your savings faster.
TCU offers a Target Share Account that lets you save for a specific goal in an account separate from your regular savings account. There’s no monthly fee, and when you use direct deposit, you can save conveniently and automatically. TCU also offers a variety of money market accounts where you can earn higher dividends with unlimited transfers and withdrawals and no minimum balance fee.
You can monitor these accounts at any time using TCU’s digital banking platform, which includes a top-rated mobile app, widgets for budgeting and a spending analysis tool.
What Are Some Expenses To Consider for the Holidays?
Holiday spending generally falls into a few major categories but the amount you’ll need depends on each individual’s preferences. By estimating how much you’ll need in each area, you can create a realistic holiday budget and then an appropriate savings plan to reach that amount. Those spending categories include:
- Travel: Traveling to visit family and friends can add up, no matter the mode of transportation. Airfares, gas, lodging, food and car rental expenses may seem daunting, but with a holiday budget you can eliminate the stress and sticker shock. Booking airline tickets and hotel reservations months in advance can save you from any holiday surge pricing.
- Gifts: Identify the people you want to buy gifts for and the amount you want to spend on each gift. Create a list and check it twice to keep from overspending. Bonus tip: if you underspend your budget per person, you can use these funds to cover any last-minute expenses or to start saving for next year.
- Entertainment: If you plan on hosting a holiday party or attending one, you can budget for this, as well. For example, you may need to cater for food if you’re hosting or buy a new ugly holiday sweater for a party. Don’t forget to include dining, movies, concerts and shows you may want to attend.
- Donations: The holiday season is traditionally a time of giving to charities or organizations. Determine which charities you’d like to help and the size of your donations. Be sure it’s accounted for in your budget. Keep any receipts because they may be tax deductible.
What Are Budget-Friendly Gifts That Still Feel Special?
For some, it may be easy to overspend on buying gifts. But it is important to remember that it is the thought that counts. If your holiday season budget is tight, there are other ways to show your appreciation that won’t break your budget:
- Handmade gifts: Custom photo gifts, DIY gifts and handwritten letters are labors of love.
- Homemade goods: DIY food jars, holiday snack boxes and tins of homemade cookies are always a hit. (Rethink the fruitcake, though.)
- Thoughtful small purchases: Books with a personal note or a self-care kit show you know the person well.
- Time-based gifts: A coupon book or a game or movie night kit with the promise to spend time with the recipient.
How TCU Can Help
Travis Credit Union can help you prepare for the holidays starting in the summer. Choose from a variety of savings products, from certificate accounts and money market accounts to Target Savings Accounts. You can also learn more about a variety of financial topics using Knowledge Base. At TCU, Knowledge is Power. Get started today.
Holiday Savings Frequently Asked Questions
Why should I start saving for the holidays in the summer?
Starting early helps spread out expenses over several months, making them easier to manage. It also reduces financial stress when the holidays arrive.
How do I figure out how much to save for holiday spending?
Create a budget by estimating your expected holiday expenses and dividing that total by the number of months until the season. This gives you a manageable monthly savings goal.
What are the main expenses to include in a holiday budget?
Common categories include travel, gifts, entertainment and charitable donations. Planning for each helps prevent surprises and overspending.
How can I reduce financial stress during the holiday season?
Start by reviewing your income, debts and expenses to identify how much you can save each month. Using dedicated savings accounts can also help you stay organized and on track.
What savings tools can help me prepare for holiday expenses?
Accounts such as a TCU Target Share Account or money market account can help you save consistently and earn dividends. Digital banking tools also make it easy to track progress and manage your budget.
What are some budget-friendly gift ideas that still feel meaningful?
Handmade items, homecooked or baked goods and thoughtful small purchases can be both personal and affordable. Experience-based gifts, such as game nights, create lasting memories without high costs.
How can planning ahead improve my overall financial wellness?
Saving consistently builds strong financial habits that extend beyond the holidays. It lets you enjoy celebrations without carrying debt into the new year.