At a Glance

  • Thomas Brock, CFA, CPA, with over 20 years of experience provides us with five of the most powerful strategies you can embrace include setting a holiday budget, freezing credit card spend, limiting social events, implementing a gift exchange and embracing an experiential holiday season.
  • For many people, the holiday season is characterized by irresponsible financial behavior, namely, unchecked spending.
  • Think ahead to avoid getting lost in the holiday spending maze. By employing some simple strategies, you can enjoy the holidays without incurring costly debt and wrecking your finances.


The holiday season is upon us. For many people, this is a joyous period that presents the opportunity to downshift at work and spend more time with family and friends. However, it can also be stressful, especially, if you are worried about your finances.

Fortunately, there are some simple things you can do to keep your spending in check and avoid credit card debt. Five smart strategies are described below. Embracing all of them (or just one or two) can help you avoid a post-holiday financial hangover.

1. Set a holiday budget

For starters, set a holiday budget and stick to it. Take a close look at your finances, and establish a firm spending limit that does not require you to tap your emergency reserve or incur debt. Ideally, all holiday spend, including outlays for parties, dining out, travel, decorations, cards and gifts, should come from your regular monthly earnings.

To improve the resiliency of your holiday budget, take the following actions:

  • Communicate openly with family and friends about budget constraints to set clear expectations.
  • Formulate a detailed shopping list to eliminate the possibility of emotional spending.
  • Begin shopping early to avoid shortages and last-minute, impulse purchases.
  • Take advantage of discounts and sales promotions, but do not let yourself be swayed by marketing hype.
  • Periodically monitor your holiday spend to stay on track.

2. Lockup your credit cards until 2024

To support your budget, commit to only utilize cash or debit cards for your holiday spend. Put away your credit cards until the new year. If necessary, physically lock them up and remove your credit card information from popular online shopping portals, such as Amazon and Etsy.

This is going to take some discipline, but it is a surefire way to stick to your budget and avoid debt. To reinforce your commitment, share your intention with friends and family members. A public pronouncement is a good way to formalize the goal and increase personal accountability.

3.Limit your social events

Attending all the holiday happy hours, dinner parties and entertainment events on your radar may sound nice, but doing so can easily throw your finances offtrack. Scale it back, and pick one or two special gatherings to attend. As noted above, communicate openly with family and friends about your budget constraints to set clear expectations and avoid unnecessary emotional strain.

4. Implement a gift exchange

Implement a gift exchange for your family unit or close network of friends. Set a modest spending limit, conduct a blind draw and focus your thoughtfulness on your designated giftee.

If you want to have an especially memorable holiday, structure the exchange to require homemade gifts. Examples include a holiday dessert, a recipe book, a sculpture or painting, a handknitted winter hat or pair of socks, a Spotify playlist, etc. You could also gift your time by offering to do something for your giftees, such as cleaning, cooking, dog walking and providing shuttle services.

Expert Quick Tip: If your group is not interested in implementing a gift exchange, consider entering into a gift-sharing agreement with a friend or family member. Sharing gifting experiences can be a smart way to cut costs, while bonding.

5. Embrace an experiential holiday season

Another excellent way to minimize holiday expenses, while maximizing enjoyment, is to embrace an experiential holiday season. This entails fostering the prioritization of spending quality time with loved ones over exchanging tangible, costly gifts.

Whether it is a cozy game night by the fireplace, a festive cooking class, a brisk hike through a local winter wonderland or a group volunteer activity, the emphasis on shared experiences adds meaning and warmth to the holiday season. It also reduces the pressure of gift-giving, fosters deeper connections and creates memories that become lasting treasures for you and your loved ones.


To initiate an open and honest conversation, begin by expressing your commitment to financial responsibility during the holidays. Emphasize your desire to focus more on shared experiences and connections, rather than the exchange of material possessions.

Encourage a collaborative dialogue, inviting your loved ones to share their viewpoints. In the process, suggest practical ideas, such as implementing a gift exchange, embracing gift-sharing arrangements and pursuing fun group activities. By fostering open communication, you can help shape a holiday experience that is both joyful and considerate of everyone’s financial situation.

Many different financial apps can assist with managing holiday spend. A few of the most popular ones include Mint, YNAB (You Need a Budget) and PocketGuard. They allow users to set budgets, track expenses and gain holistic insights into their finances. That said, before you spend money on an app, consult with your banking institution to ascertain its offerings.

An emergency fund is a liquidity reserve designed to provide you a safety net in the event of unexpected financial distress, such as incurring uninsured medical expenses or auto maintenance costs. Typically, this safety net equates to three to six months of living expenses.