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Not everyone has experienced the economic ups and downs of 2020 in the same way: Working families, retirees, recent graduates, newlyweds – we’ve all been impacted personally and financially, through incalculable and unique changes, big and small. And as the holiday season approaches, many of us are aching for something to look forward to: a time of comfort among loved ones; an easing of stress with kindness; maybe even a little sense of normalcy.

Holiday spending this year should probably feel a bit different, though, since taking on new debt for gift-giving and celebrating may hurt future plans in unexpected ways. Unpredictability is the new normal for household financial factors, like employment situations, savings capacity and investment performance.

With that in mind, KeyBank offers holiday money-saving to help you have a festive season within a budget that will keep you and your wallet smiling into January 2021.

Proper Planning

Who wouldn’t want a debt-free holiday season? Start now, and focus on detailed spending plans and clearly communicated expectations. Follow these steps:

  • Make a list of gift recipients, noting specific gift ideas – and their costs – or a dollar guideline to go with each.
  • Then consider other holiday expenses, like whether you’re buying new outdoor equipment to prepare for the weather, hiring a snow plow service or spending money on winter sporting goods.
  • Think about increasing charitable donations during the holidays, too. This is a common practice, so make sure you account for everything you can think of.

Now it’s time to take a good look at your budget:

  • As best as you can, track your upcoming earnings heading into the holiday season.

    Note your regular paycheck dates and amounts; if you freelance or receive other irregularly timed income, this can be tricky – make sure you’re communicating or invoicing in a timely manner so you can plan as accurately as possible.

    If you have an employer who has typically awarded end-of-year bonuses, try to find out in advance whether they’re in the works this year. Err on the side of caution: If you’re not sure about bonus pay, don’t count on it.

  • Look at your overall household budget and determine what you want to spend, and how much you can afford to spend.

    Don’t push yourself to feel financially uncomfortable: If you’re currently making only the minimum payments on existing credit card debt, for instance, try to avoid adding to those balances over the holidays. It’s a safe bet that folks receiving gifts from you wouldn’t want you taking on money stress to make it happen.

  • Use the 50/30/20 budget as a guide.

    This approach organizes your expenses into needs, wants and savings, with the goal being to allocate 50% of your income to your needs, 30% to your wants and 20% to savings, investments and debt repayment. Keep in mind that you might need to tailor it to fit your specific circumstances.

Once you’ve come up with a holiday spending goal that fits your budget, it’s time to figure out how to achieve it.

If there’s a single piece of advice above all others when it comes to saving for the holidays, it’s this: Once you’ve got your plan in place, stick to it. It may not be easy – but it will be easier than trying to make up lost ground and lost time if you get off track.

Saving Up

You’ve ironed out the budget wrinkles and set your spending goal. Now, let’s figure out how much you’ll need to save to achieve it. Try these tips:

  • Smart holiday shopping starts with saving – particularly, how often you’ll put money into your designated holiday savings. Regularity is key. The holidays come up quickly, so there’s not really time to push off one planned infusion of savings before the next one arrives.
  • It’s also well worth considering setting up a separate account for your holiday funds, to keep you from inadvertently reducing it through small, everyday purchases or your regular budget spending. We’ve set up an easy-to-use Savings Goal Calculator that will help: Check it out here.
  • Don’t forget to consider any cash alternatives you may have accumulated over the year, like cash back or points on credit cards, retail rewards or unused gift card balances. Track these and consider them part of your savings as well.
  • You can also use the planning phase to watch for bargains and sales, using shopping apps to help you keep an eye out for the best deals. If you know something’s going to be cheaper early on in your saving process, plan your budget accordingly.

If there’s a single piece of advice above all others when it comes to saving for the holidays, it’s this: Once you’ve got your plan in place, stick to it. It may not be easy – but it will be easier than trying to make up lost ground and lost time if you get off track.

Making the Most of Gift-Giving

Maybe you’ve already got the perfect gift in mind for everyone on your list – and maybe they all fit squarely within your budget and will be readily available for delivery well in advance of the holidays.

If that’s the case: Good for you – relax and enjoy! For the rest of us, it’s time to dive into gift-giving, using these smart shopping tips.

  • Toss out the idea that presents must be brand-new, purchased or even actual things.

    Spend some time thinking about the connection between you and those you’re giving gifts to, and what each gift – and the gesture of giving it – means to both of you.

    It’s easy to get wrapped up in checking boxes on a “to buy” list, especially the closer the holidays get, so the further in advance you can find some moments to consider these meaningful connections, the better. (Those people who seem to get their holiday shopping done months ahead of time are likely just paying attention year-round when something catches their eye, or a particularly personal gift idea pops into their head.)

  • Making those deep connections doesn’t have to be financially extravagant.

    Look at pieces of family history to pass along – old photos that can be preserved and framed, for instance, or heirlooms from previous generations. The stories attached to gifts like these can be treasured as well, lasting beyond a lifetime.

  • Another powerful expression of appreciation? Knowing what matters to someone else’s worldview and passions.

    Learn what nonprofits your friends and family support – or which have made a personal impact on their lives – and make a financial donation in their name. Another option is arranging to donate volunteer time, perhaps together, to make a positive difference for an organization that means a lot to someone you care about.

  • Keeping everyone’s health in mind, events and experiences make wonderful gifts.

    And they can be found to fit a wide range of budgets. A special, shared, home-cooked meal; a family photo shoot; or a group wilderness outing to a national or state park can be inexpensive and incredibly fun.

  • Supporting the arts can be both a gift and a community investment.

    Look into museum and nature center memberships, or future passes to local orchestra and theater productions.

Remember What’s Most Important

Above all, maintain a sense of perspective: The holidays can be stressful, but they don’t have to be.

With careful budget planning, appropriate spending and thoughtful gift-giving, you can celebrate the close of a tumultuous year with some comfort and joy among those who matter most.

This information and recommendations contained herein is compiled from sources deemed reliable, but is not represented to be accurate or complete. In providing this information, neither KeyBank nor its affiliates are acting as your agent or is offering any tax, accounting, or legal advice.

By selecting any external link on, you will leave the KeyBank website and jump to an unaffiliated third-party website that may offer a different privacy policy and level of security. The third party is responsible for website content and system availability. KeyBank does not offer, endorse, recommend, or guarantee any product or service available on that entity's website.

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