Tips to better manage holiday spending

Photo: Adobe

COLUMBUS, Ohio—Increased expenses that can occur during the winter holiday season can make it hard for some consumers to avoid overspending. While this has become an annual issue for many people, increased inflation this year has more consumers looking for ways to stretch their budgets while still enjoying the festive season.

According to the 2022 Holiday Outlook by PwC, formerly Price Waterhouse Coopers, total holiday spending this year will be similar to last year, with the average consumer planning to spend $1,430 this year. The international accounting firm surveyed more than 4,000 consumers.

“Despite citing fears of inflation and the rising costs of transportation and utilities as deterrents to holiday spending, most consumers—74%—told us they plan to spend the same or more this holiday season as they did last year,” PwC said in a written statement.

However, 65% of consumers said that price ranks as the highest factor that influences their holiday spending, with 75% of consumers reporting that they’ll wait for the best deals before shopping.

That’s why it’s so important—especially this year—that as you plan for the holidays, you make sure that you have a clear picture of where you are financially, said Emily Marrison, an Ohio State University Extension program specialist in healthy finances. OSU Extension is the outreach arm of The Ohio State University College of Food, Agricultural, and Environmental Sciences (CFAES).

One way to do so is to consider creating a spending plan rather than a budget, Marrison said during a recent episode of “Extension Today,” a production project done in partnership with NBC4 WCMH-TV. The weekly segment offers stories about gardening, cooking, and other tips, and resources for improving Ohioans’ gardens, lives, families, and local communities.

“Calling it a budget makes it feel like our hands are tied, but creating a spending plan gives us more freedom and more control over what we’re going to spend during the holidays,” she said. “I really like to think about this from a joy factor standpoint—what brings you or your family the most joy?

“This is something you can think about as you divide your spending plan into different categories, focusing on what you should be spending the most money on.”

Marrison said a good spending plan starts with deciding the total amount that you can afford to spend, and then dividing that amount among multiple categories that can include food, decorations, entertainment, travel, holiday cards, charity, and gifts.

“Think about what are the numbers that you would like to see, and keep that in mind as you are creating your spending plan,” she said. “Focus on allocating more money to the areas that bring the most joy to you and your family.”

“It’s totally OK to spend less in the areas that don’t mean as much to you. And remember, you give your ‘future self’ a gift when you stick to the spending numbers you had in mind. It can be a joy when you check your bank balance after the holidays and you’ve stuck to the plan.”

Here are some other tips to help you formulate a holiday spending plan that avoids financial pitfalls:

  • Make savings automatic. Set aside a portion of your paycheck. Start saving now. Transfer to your savings a set amount of money from each paycheck.
  • Start with a list of everything you’ll be spending money on during the holidays. Include all gifts, foods, drinks, decorations, and charitable giving.
  • Set reasonable expectations. Take a look at your monthly budget, decide how much you can really spend on those holiday extras, and plan your budget accordingly.
  • To determine your holiday spending plan, review what you spent last year. Then, use that amount as a guide for this year. Remember to include all money spent on gifts, foods, drinks, decorations, and charitable giving.
  • Once you’ve created your spending plan, stick to it.
  • After your spending plan is made, prioritize where and how you’ll spend. Be sure to account for everything: gifts, decorations, donations, a new piece of clothing, groceries, and baking.
  • Prioritize. If you come up short, determine where you can do some trimming. Can you forgo new holiday decorations this year? Can you pledge to avoid spending money on yourself when you’re out shopping?
  • So many things about this year are nontraditional, so if your money is tighter this year than usual, think about starting new traditions that don’t require you to spend as much money. For example, instead of buying for everyone in your family, you can opt for a family gift exchange that will allow you to buy for one person instead of the whole gang. That way, everyone still gets to be involved in the holiday experience. If you need to, adopt a new tradition that requires no money spent at all, such as watching a holiday movie together, baking your favorite holiday treat, or taking a festive holiday walk.
  • Keep an eye out for online and in-store deals and sales. Retailers are offering Black Friday deals over multiple weeks this year. Grocery stores often offer specials on holiday-related food items. And limit the number of shopping trips: The more you are in the stores, the greater the chance you’ll make impulse purchases.
  • Don’t wait until the last minute. That’s one of the best ways to go into debt during the holiday season. Take advantage of preholiday sales and free, online shipping.

Lastly, look ahead when thinking about your spending, Marrison said.

“Now’s the time to realistically start planning for next year,” she said. “Take the holiday budget you’ve set for this year—or what you wish it could be—and divide it by 12. Then, set up an automated plan to deposit that amount directly from your paycheck into a special savings account for holiday spending next year.”

More consumer tips and helpful information from CFAES experts can be found at and

Tracy Turner
For more information, contact: 

Emily Marrison