9 Smart Holiday Shopping Tips

The holiday shopping season is coming as marked by the approaching Black Friday. People all over the U.S. will be spending billions of dollars on gifts for friends, family, and co-workers. I think now is more important than ever to be smart about spending money during the holidays.  I offer you 9 tips for smart holiday shopping:

Photo by singsing_sky via flickr

1. Create a Holiday Shopping Budget and Stick with It.

First look at your overall budget to determine what you can and are willing to spend this holiday season.  Remember that time is tough for many people, so it’s okay to not spend a lot of money this year.  Be realistic. Next, sit down with your family and make a list of everyone you are going to buy gift for — this is your Holiday shopping budget. Next to their name, write an amount you are going to spend on them.

After you finish going through the list, you may have to come back and readjust the amount next to each name so that the total fits into your overall budget.

2. Don’t Try to Outdo Others.

I know that some of you feel that you have to do better than the last year, or give gifts that are just as good as what you are receiving. Personally, I know that feeling and I also feel bad when my gift is not as good as others.  But you have to remember that giving gift is not a competition, and it is more important that you buy gifts within your means.

If you really want to give something that’s beyond your means, ask your friends and family to see if they are willing to split the cost.  My family occasionally split the cost on really expensive items.

3. Buy Online.

I think buying online is a terrific way to save money when you are shopping for presents.  I wrote about saving money by shopping online by using sites like Ebates.  Additionally, Madison of My Dollar Plan has a great list of resources for online shopping.

Personally, I recommend using credit card for online shopping due to greater security and the small reward that you can get.  However, if you are not comfortable using credit card, using your debit card is okay too. If you don’t have a good reward card yet, here’s a database of the best reward credit cards.

4. Use Cash.

No, I am not a schizo.  If you can’t handle credit card, or if you can’t afford to pay the credit card in full, please use cash.  Some people claim that you’ll spend less money when you use cash as opposed to credit card.

For example, Lynnae at Being Frugal wrote about The Benefits of a Cash Christmas, and shared why she prefers not to use credit card for holiday shopping.

5. Don’t Buy On Impulse.

Remember that you have a list and a tight budget.  It’s easy to get distracted regardless of whether you shop online or go to your local stores.  These guys are rally good at putting “deals” and “specials” in front of you so that you’ll forget your list and budget.

Just resist the temptation, say no, and stick to your budget.

6. Don’t Open Store Credit Cards.

I know it’s tempting to get that 10% or 20% off your purchase for the day, but don’t do it!  You’ll most likely blow your budget, buy stuff you don’t really need, and ended up paying interest with the payment is due.

Let’s think about it for a minute.  These stores must be making a lot money on interest and late fees in order to offer you that special 10-20% off deal.

And yes, if you mess up with these store credit cards, your credit scores and history will be affected.

7. Don’t Fall for the No Payment Financing Offers.

Yes, it’s great that you can buy something and don’t have to pay for it until 6 months later.  But that’s another way these stores are getting you to spend more money than you have.  Remember that you have a strict budget that you’re following, and you are planning to pay off the credit card in full (if you are using one).  So these offers shouldn’t even matter to you.

Stores that offer this kind of deal make astronomical amount of money when you fail to make payment in full in the allotted time.  When this happens, they charge you outlandish interest rate on the entire grace period — i.e., 6 months.

8. Don’t Buy Extended Warranties.

I think extended warranties are huge rip offs.  First, if you calculate how much they cost as a percentage of the item you are buying, it’s a significant amount.  Second, the manufacturer warranty protects you for up to one year against any defect, and that should take care of most problems.  Based on my experience, if something is going to break, it will break during the first year.  And if it breaks afterward, I probably want a new model by that time.

Pete at Bible Money Matters wrote a long article about how he took advantage of manufacturer’s warranties and why extended warranties should be avoided.

9. Give the Gift of Savings

Last but not least, if you still cannot find the perfect gift for some folks on your list, you may consider giving cash.  I know some people may think it’s lame, but it may be appreciated by the receiver more than you think. If you feel that giving cash is not the right move, you could also try the college fund contribution angle.

How about you?  Do you have any holiday shopping tips that you can share with us?  Please do, we can all use some more tips!

About the Author

By , on Nov 25, 2008
Pinyo is the owner of Moolanomy Personal Finance. He is a licensed Realtor specializing in residential homes in the Northern Virginia area. Over the past 20 years, Pinyo has enjoyed a diverse career as an investor, entrepreneur, business executive, educator, and financial literacy author.

Leave Your Comment (11 Comments)

  1. Priscilla says:

    What about an extended warranty for accidental breakage for an iPad?

  2. Fredrick says:

    @John I agree, it’s hard for many businesses these days that don’t put forth any effort to appeal to online shoppers. As a brick and mortar you should be dependent on both sources of income if you’re going to make it.

  3. Sue says:

    I’m a paralegal and with everything else going on in my life, shopping online makes the most sense for me. Mom has terrible allergies, and after careful research I found out about something called a vapor steam cleaner. Seems that you can only get one of these online. Sure the stores have cheap imitations, but they are really shabby steam cleaners not vapor cleaners. If you have a loved one who is suffering from allergies this is something you might want to consider. Here is an article I just found about them.


    Happy holidays!

  4. John says:

    Seriously? In a tough economy you are telling people to shop online??? If there is a local store that carries an item you are interested in.. BUY LOCAL. Next time a store closes its doors ask yourself if you purchased any item they sold in those doors online? If so.. you helped negatively impact the local economy. Also, I would not be so quick to say never buy an extended warranty.. yes there are times that the cost may not offset, but in most cases with a reputable company that is offering the service, the item can be replaced or your purchase price refunded for as little as 10% of the original item. Why spend $30 next year when you can basically get that same item, or the newer version for $3? Even if it cost you two to send the item back your still ahead of the game. You should see what is covered and think how you will use the item prior to making a decision

  5. Horlic says:

    Shopping online, easy to do price comparisons to find out the cheapest price with just clicking infront computer. Save money on petrol, less pollution, time saving..

  6. Nicole says:

    I love shopping online – groceries, music, flowers, fruit gifts, photos, furniture – I buy everything online! …and I always hunt for the best bargain. It sometimes takes me longer to make my final purchase, but when I do, I know i’ve gotten the best deal.

  7. Jonathan says:

    I now do all our grocery shopping online and having initially been skepitcal about it I am won over by the idea. Initially it takes a few hours to set up and create a “Usuals” shopping list but it now takes me 20 mins to do our complete shop and we also save money because I find a e-discount code for free delivery every week. After 12 months of doing grocery shopping online I can honestly say it’s cheaper and the quality of the fresh products are much better than in the phsical store itself, so yes you can save money by shopping online

  8. Nicki says:

    I’m with Lynnae on the Cash Christmas. I don’t use my credit card and I carry cash (not even my debit card) when I’m making my Christmas purchases. I’ve also printed out a checklist of items I intend to purchase for Christmas which I keep in my purse for reference. It sounds silly and my mom and sister make fun of me for it, but I don’t care because it really works. Thanks!

  9. Momma says:

    I definitely agree with shopping online…. I also think shopping at flea markets and thrift stores is also a good idea. You’ll be surprised at how much NEW STUFF you can find there, with tags! Never worn!

    Also, making your gifts… Christmas candies are always popular, and are a great gift for family and friends…. nothing beats my mom’s homemade chocolate peanut butter balls…. mmm… (hoping we get some of those this year!) 🙂

  10. Dawn says:

    Good hints! I started my Christmas budget at the beginning of the year, so I already have my money set aside for the holidays, but that means I have to stick strictly to my budget. I know exactly how much I can spend – and there is no room to go over.

  11. Caveman says:

    A budget is a huge help that many people throw out the window as soon as they walk into the store. Sure, there’s a lot of shiny stuff calling for your attention, but sticking to that budget is the only way to keep a sane spending level.

    Thanks for the mention. Our cash-only Christmas is going well so far. We’ve only tapped into a bit, but it’s nice to know exactly how much we have and what we have left to spend.

Leave a Reply

Your email address will not be published. Required fields are marked *



The information on this site is strictly the author's opinion. It does NOT constitute financial, legal, or other advice of any kind. You should consult with a certified adviser for advice to your specific circumstances.

While we try to ensure that the information on this site is accurate at the time of publication, information about third party products and services do change without notice. Please visit the official site for up-to-date information.

For additional information, please review our legal disclaimers and privacy policy.


Moolanomy has affiliate relationships with some companies ("advertisers") and may be compensated if consumers choose to buy or subscribe to a product or service via our links. Our content is not provided or commissioned by our advertisers. Opinions expressed here are author's alone, not those of our advertisers, and have not been reviewed, approved or otherwise endorsed by our advertisers.