CONNECTICUT MONEY: Plan your holiday spending early

This article was published in the New Haven Register on September 29, 2019

The economy is booming, employment is robust, and the holiday season is nearly upon us. It’s a perfect recipe for over-spending, so now is a good time to start thinking about how to get through the holidays without busting your household budget.

Consumer spending over the holiday period has been rising steadily in recent years. In 2018, the last year statistics are available, the National Retail Federation said the average consumer planned to spend $1,007, up 4.1 percent from the year before. Of that total, about $635 was slated for gifts, while the rest was to be spent on non-gift items such as cards, flowers, decorations and food.

In a Gallup poll last year, 33 percent of respondents planned to spend at least $1,000 on gifts, and 22 percent planned to spend between $500 and $999.

By all means, get caught up in the Christmas spirit and give nice gifts to your family members, friends and coworkers. Just don’t get so caught up that you wreck all the hard work you’ve done the rest of the year staying within a budget and saving money for retirement. Here are some tips to keep your holiday generosity within reason:

Set limits. First, set a limit on how much money you can afford to spend on gifts, taking into account your financial plan and savings total for the year so far. Within that limit, write down the name of every person you want to give a gift to and set a limit for each person. Also set a limit on how much you can afford to spend on non-gift holiday items. If you can, set aside enough cash to pay for everything with a check or debit card — using credit cards is a good way to overspend.

Start shopping early. It can be tempting to wait for late holiday bargains and start shopping at the last minute. However, making multiple purchases during shopping trips under the stress of needing to “get it done” often results in over-spending. By starting early, you can take the time to compare prices, and you’ll avoid the “impulse buying” that is encouraged at malls and retail stores.

Use online shopping wisely. You can find cheaper prices on the Internet, but sometimes they are accompanied by high shipping costs and/or service fees. Be careful when shopping online that you don’t get carried away by the price tag and ignore other variables.

Be wary of Black Friday and Cyber Monday hype. Retailers want you to think these two promotional events are chock full of great bargains, but studies show prices are generally the same as during regular holiday sales. The truth is that retailers offer various deals throughout the holiday season, you just have to do your research to take advantage of the ones most suited to your gift-giving plans.

Consider making gifts. Look at your gift recipients’ list and choose some people to give homemade gifts such as photo collages or baskets of cookies that you bake.

Look ahead to next year. If there are certain people you tend to buy expensive items for, set up a special savings account in January dedicated to putting aside money for fall 2020. It’s never too early to start planning ahead for a financially merry Christmas!

Eric Tashlein is a Certified Financial Planner professional and founding Principal of Connecticut Capital Management Group LLC, 2 Schooner Lane, Suite 1-12, in Milford. He can be reached at 203-877-1520 or through This is for informational purposes only and should not be construed as personalized investment advice or legal/tax advice. Please consult your advisor/attorney/tax advisor.