I consider myself a savvy shopper (even during the holidays) but sometimes that seasonal fervor really gets to me. This time of year all I can see are cashmere sweaters, cozy blankets and games my children have been begging for all year long—and all at bargain prices. How can I say no to these things? The truth is—I don’t have to say no—I just have to shop smarter. By avoiding these five holiday shopping mistakes, I can get all of the things my family wants for the holidays and still stay on budget!
1. Budgeting only for the gifts.
When it comes to building your holiday budget, many people make one fatal error—they only set a budget for the cost of gifts. This is perhaps the most common and most costly of all holiday budgeting errors you can make because many of the associated expenses are not optional (especially if you want your recipients to receive their gifts).
- Your time: Your time has value. The time you spend shopping is time taken away from couponing, working, and other activities that generate savings.
- Gasoline: In many parts of the country now, a gallon of regular gasoline costs more than $4.00. Here, shopping online can help you save (so long as shipping is free).
- Gift wrapping materials: Unless you plan to shop only at retailers who will gift wrap for free or ship gifts you order online directly to your loved ones—you’ll likely need to buy a few rolls of wrapping paper, tissue, tape, ribbons, bows, cards, etc. Check out dollar stores in your area for super-cheap wrapping supplies.
- Postage and packing boxes: If you mail through priority postal service and your gifts fit into the free boxes then you’re set! Just make sure you reserve enough time to ship via the postal service to avoid costly charges at specialty shipping stores. If you plan ahead you can also avoid costly postage charges (expedited or overnight shipping), which can save you $10-$20 in postage for each gift you ship.
2. Signing up for too many email alerts.
Signing up for extra email alerts can be a smart strategy if you're going to be shopping at a particular retail store for a specific item—if you're buying it anyway, why not nab a discount in advance! But signing up for every retailer's holiday email alerts can backfire—big time.
- What the research says: Surveys by iContact show that you will spend an average of 83% more just by signing up for a retailer's email marketing alerts.
- What to do: If you get a lot email alerts, sign up for a free service like Unroll.me that lets you view all of your subscriptions and opt out of ones you don’t want anymore. If you only get a few alerts, you can direct them into a specific folder in your email account so that you can read at will.
3. Shopping at the last minute.
Sometimes I procrastinate on buying holiday gifts. Here, a combination of factors tend to be at work—I don't know what to buy, I don't have time to go shopping, I don't like holiday crowds, I don't want to spend money—my list of excellent reasons to put off holiday shopping is endless. But it’s also expensive if I wait too long.
- What the research says: The American Research Group recently reported that shoppers who procrastinate on buying holiday gifts spend an estimated $120 or more per person than shoppers who plan ahead.
- What to do: This one is simple—don't wait to shop! Whenever you’re tempted to procrastinate, ask yourself what you would like to use that extra $120 for?
4. Picking up an item before deciding to buy it.
I don’t know about you, but I always find myself buying way too many blankets during the winter. When I see one that looks super soft, I have to go touch it and I almost always end up buying it. According to Time, new studies suggest that this is because of the "endowment effect.” It’s responsible for whether you’ll buy an item and how much you’ll pay for it.
- What the research says: If you pick up an item before you make your decision whether to buy it or not, you’re more likely to buy it and willing to pay more to obtain it.
- What to do: Don’t pick up an item you haven't decided to buy yet. If you can't see the price tag, ask an associate (or a friend) for help. Ask yourself: "Is this the best way I can spend my money?" Then listen for your own answer (while following the advice in #5 here).
5. Getting carried away by impulse.
Perhaps you go into a store to buy one specific thing. But while you are buying, you begin browsing. Your cart, which contained only one item, suddenly has two, then three items, and before you know it—your cart is full!
- What the research says: Marketing scholars at the Journal of Marketing Research call this the "momentum effect" for good reason—and it can be very expensive for holiday shoppers on a budget!
- What to do: Do not handle the item (see #4). Take a required short break after you purchase something. Take deep breaths when you feel an upwelling of "holiday spirit.” Set a mantra for yourself, "Budget or Bust!" and repeat it when the momentum starts to get to you!