Key takeaways

  1. Despite plans to purchase fewer gifts, Americans plan to spend more this year than last year
  2. The average American plans to spend ~$1,652 in 2023, exceeding pre-pandemic levels for the first time
  3. To make the most of your cash flow, create a spending plan and categorize your gifts by effort and cost
  4. Use credit cards strategically, be aware of “Buy Now Pay Later” programs, keep receipts for returns and exchanges, shop local when possible, and donate to meaningful causes
  5. Shopping hacks like browser extensions, coupons and promo codes, as well as following the 24-hour shopping rule can help you save even more

The holiday season is here, bringing with it a festive spirit and a more generous economic outlook than last year.

Deloitte's 2023 holiday retail survey found that the average American plans to spend about $1,652 this holiday season—up from $1,455 in 2022—exceeding pre-pandemic levels for the first time.

Interestingly, the survey found that holiday shoppers will slightly cut the number of gifts they purchase this year to eight, compared to nine last year. 

Perhaps the recent sting of high inflation is to blame for the single-gift deduction. After all, the dollar just doesn't go as far as it used to.

So what is one to do when faced with sky-high prices and a shopping list with several boxes left to check? They get savvy, crafty, and learn how and when to spot a deal.

Our list that follows will walk you through 7 essential shopping hacks you can use this holiday season.

1. Start with creating your holiday spending plan

Your holiday spending plan includes more than just what you spend on gifts, so break it down into separate categories.

Here are some of the most common expenses to consider:

  • Travel expenses 
  • Holiday events (parties, fundraisers, kids' functions) 
  • Decorations
  • Food and drink
  • Charitable giving

It can add up to thousands of dollars in the end. So make sure to account for all of your holiday-related expenses so you're not sitting at the bottom of a mountain of debt come the new year. 

2. 'Bucket' your gifts

You may also want to itemize your gifts by category. This can not only help you to see where your dollars are going but also help you figure out how much time it will take to purchase (or make) each gift. 

For example, gift cards are increasingly becoming one of the most gifted items consumers give during the holidays. They're easy to find at any major grocery, department, or drug store, and they're even labeled by denomination! Drop these into the 'minimal effort' bucket.

If you're more of a do-it-yourselfer, allow a little more time for the baked goods and hand-whittled tchotchkes you're giving away. While they may be one of the more frugal gift ideas, buying the ingredients and creating these items on your list will certainly take longer.

Categorizing these gifts by price and level of effort will help you stay on your time and money budgets easily.

3. Use your credit card points wisely

Many credit cards let you use accrued points to buy merchandise, often from preferred retailers. The credit card company may even have its own shopping site. Some also provide early access to hot items in short supply. 

Make sure you aren't sacrificing points that would be better spent elsewhere. For example, if your points are worth 1.5x if you redeem them for travel but only one point if you use them to shop, you're sacrificing points. So your points might buy, say, $300 in merchandise but $450 in travel.

4. Avoid "buy now, pay later" programs

Whether the offer is a layaway program or one of the new installment plans (Buy Now Pay Later - BNPL), this is equivalent to running up your credit card balance. 

Try your best to only buy what you can afford to pay immediately or in January. Payment plans can come with interest rates north of 15%. Even plans that promise no fees and no interest come with fine print and can turn into debt traps. They can charge hefty fees and back interest if you miss one payment.

5. Keep your receipts

Exchanges and returns are quite common. Keeping your receipts will make the process stress-free and help you avoid "store credit only" returns. It's also a good way to do one final tally of how much you spent and how you did compared to your gift-giving plan.

6. Giving back as an added way of giving

There are two ways to give back to your community. 

  1. Shop local: By keeping your money in your community, you can help the local businesses you love to frequent. 
  2. Give from the heart: Don't forget the organizations and causes that are important to you. Many of them could put your donation to good use and conquer their funding challenges.

7. Three bonus hacks

  • Shop around and check at least two retailers and online sources. Don't forget web browser extensions such as Honey that can help you find discounts, coupons, and the lowest price.
  • Check for coupon codes, promo codes, and shipping codes with a quick Google search. Spend a few minutes for major purchases, and you may just find a few extra dollars.
  • Follow the 24-hour shopping cart rule. If you aren't 100% sure of a purchase, leave the item in your online shopping cart for 24 hours. It will force you to think twice before clicking "proceed to checkout."

Need help managing your cash flow this holiday season? Want to get a better handle on your finances in 2024 and beyond? Give yourself the gift that keeps on giving and start the conversation with Facet's team of financial planning experts today.