3 Holiday Overspending Traps to Avoid This Year

man and woman putting holiday gifts in trunk

If you're like a lot of holiday shoppers, you've already started hunting for pre-Black Friday bargains. But unlike in years past, you might be planning to make the majority of those purchases online, pick them up in-store, or use same-day delivery. According to the National Retail Federation, a record number of shoppers (60%) plan to do their holiday shopping online this year.

While the pandemic is credited for the increase in online sales in 2020, the desire to avoid crowds might make it easier to overspend this season due to holiday spending traps that are sure to pop-up while you're shopping online.

Here are three simple, wallet-friendly ways to enjoy the festivities:

1. Set a Holiday Spending Limit

Before you even open your online browser, create a holiday budget. Without a spending limit, it's easy to buy more than you can afford — especially on friends and family you haven't seen in months. Assign a maximum spend for each person, event, and meal during your holiday plans.

2. Shop With Credit Card Rewards

Instead of dipping into your savings, use your credit card rewards to pay for some of your holiday gifts. Including the reward amount in your holiday budget, rather than viewing it as a bonus amount that you can use for a splurge, can help reduce your total out-of-pocket holiday costs. Apply the savings to achieve another financial goal, such as building an emergency savings fund.

3. Skip Add-ons at Checkout

 Savvy shoppers hope to take advantage of special sales and promotions before items sell out. But those deals can be less of a bargain if you fill your cart with extra items at checkout. To boost sales, retailers often entice shoppers with items related to those already in their online shopping cart. A carrousel of items might appear with a tag like "More to Consider" or "Did You Forget?" As attractive as these offers can be, ignore them and stick to your holiday list and budget to avoid overspending.

Bonus Tip: Grab your holiday shopping list and head to the online clearance sections of your favorite stores to make the most of every dollar spent.

 

When you use your Hanscom FCU CASH + REWARDS World Mastercard®, you'll earn 2x bonus points on all of your purchases made between November 1 and December 31, 2020. Learn more here.

Hanscom FCU World Mastercard Holiday Bonus Promotion

 

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About Author

Tracy Scott
Tracy Scott

Tracy Scott is a freelance writer who specializes in personal finance and higher education. Her reading list always includes a seemingly odd mix of financial literacy articles and sweet romance novels. Tracy holds a BA in Psychology from UT Austin and has a background in higher education regulatory compliance.

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