Nearly $1 out of every $5 spent at a shopping center or factory outlet throughout the year of 2014 was done over the holiday season. Topping the holiday season-related spending ahead of the combined sales of other holidays like Mother’s Day, Father’s Day, Valentine’s Day, Halloween, Easter, and St. Patrick’s Day, and puts huge pressure on retailers to perform.
In turn, they tend to pull out all the stops to attract as many customers as possible to their stores, and with so many deals being thrown around, it can be easy to overspend your budget.
According to the Motley Fool contributors, here are the top tips they use to save money over the holidays:
Dan Caplinger: For those who can’t figure out what gifts to buy for a special someone, gift cards have made it easy to pick a person’s favorite store and let them make the final decision on exactly what to buy. What many people don’t know, though, is that you can often obtain gift cards at substantial discounts to their face value.
Gift card exchange services proliferated shortly after gift cards became popular, as many recipients of gift cards found that they didn’t actually want to shop at a particular store and would prefer to receive cash instead — even if it meant accepting less than what the card was supposed to be worth. With these services, you can sell back unwanted gift cards to get a certain percentage of their value back in cash, with the exact percentage depending on demand for the store’s products. However, most services also act as a clearinghouse, allowing people to buy gift cards. The discount is typically less than what the service pays to those who sell gift cards, but it’s still less than face value, and sometimes the discount can be substantial.
Gift cards can be a great choice for people who are tough to shop for, but there’s no reason to pay more than you have to for them. If gift cards are on your shopping list, be sure to check out exchange services to see if you can get the cards you want on the cheap.
Todd Campbell: A lot of people think “budget” is a four-letter, rather than a six-letter, word, but just because budgeting isn’t fun doesn’t mean that it isn’t important, especially during the holidays.
Retailers count on shoppers to pony up for impulse purchases and they spend countless time, money, and effort to ensure that their most profitable impulse items are located strategically in their stores. Without a spending game plan, it’s more than likely that you’ll find plenty of extra this and that’s ending up in your shopping cart by the time you reach the checkout lane.
In order to beat retailers at their own game, spend the time up front to write down the people that you’ll be gifting this year and then make sure to record your spending as you go so that you know when you’ve reached your limit. Importantly, stick to the budget once you’ve made it. If you don’t, you could regret it once the credit card bills arrive in January.
Brian Feroldi: While most retailers tend to lure consumers in with insanely low prices on popular items, they bank on those same customers picking up far more than what they came in for, which can lead to adding items to your shopping cart for higher prices than you can find elsewhere. For that reason, I always make sure I have my smartphone with me when I’m shopping so I can easily compare in-store prices with those found online to make sure I’m getting the best deal.
It’s extremely easy and fast to comparison-shop nowadays — there are many free apps that can help you do that. Amazon.com, for example, has a free shopping app called “PriceCheck” that makes it easy to check the price of an item on their website. You simply open the app and scan the barcode of the item you want to buy and it shows you the price of the same item on their site. Sometimes it’s lower, other times it’s higher, but I’ve personally used the app dozens of times to make sure I’m getting the most bang for my buck on a purchase.
While you’d be right to think that retailers frown upon the concept, the genie is out of the bottle here, so several retailers have already announced policies that show they are willing to match lower prices found online. Best Buy, for example, has a price-match guarantee that will allow you to buy the item in the store for the same price that you can find at a number of discount online stores. Using this easy technique could easily save you a few dollars this holiday season if you are willing to do a little extra work to grab the discounted price.
Jason Hall: Millions of Americans will travel during the holidays. If your family is part of that group, you may be able to save a lot of money by avoiding the airports and driving instead this year.
Since this time last year, gasoline prices have fallen 25% on average:
In many places, they’ve fallen even more.
Last year was one of the busiest ever for airline travel over the holidays, and this year is likely to be even busier, with jet fuel prices down even more than gas, which should help ticket prices stay low. But that just means even more crowds at the airport, longer security lines, and more stress for the whole family.
Driving to your destination, if it’s close enough, is almost guaranteed to save a family of four hundreds of dollars, even if you have to add a hotel stay or two. And while it may not be stress-free, you can at least stop and stretch your legs while you cool your temper when the kids get unruly.
Selena Maranjian: A great way to save money during the holiday season is to just spend less — by paying with cash. Sure, credit cards are wonderfully convenient, letting you charge just about anything you’d like at any time without having to go to the bank, but there’s a big downside to them, too: You’re likely to spend more when you use them.
A Dun & Bradstreet study found that people spend 12% to 18% more when using charge cards than when paying in cash. McDonald’s has noted that sales at their restaurants increase by 40% when they start accepting credit cards.
When you pay with cash, you have a finite amount of it in hand at any one time. A cash transaction can feel more real, making us spend less freely. As Carnegie Mellon professor George Loewenstein explains, “Credit cards effectively anesthetize the pain of paying… You swipe the card and it doesn’t feel like you’re giving anything up to make the purchase, unlike paying cash where you have to hand over bills.”
So consider setting some rules for yourself. You may want to keep a charge card on you, but perhaps only use it to pay for necessities such as gas or toothpaste. For most discretionary purchases, such as gifts and even restaurant meals, use cash.
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