Christmas in a recession: How to prepare when money is tight
The holiday season seems to be barrelling toward you and, frankly, you just can’t on all the fronts; the presents, the parties, the fashion, the hosting and the special events. And let’s not even start on the ridiculously overpriced gifts for your kids that your neighbours are buying and that your little one will have to do without.
Money is tight, the recession is making you nervous and all this looming spending reeks of financial anxiety.
Listen, it does not need to be this way. You can have the best holiday season even when you’re broke. Here’s how.
Level with your friends and family right now about where you’re at financially.
No, you don’t need to tell people the inner workings of your finances. But, chances are that if you share your desire to spend considerably less this year, you’ll find most are in the same boat, and will be relieved that the financial expectations are smaller on everyone! If your family and friends aren’t respectful of your wishes, simply put those individuals on the naughty list and fill their stockings with wood chips (I’m only half kidding).
If you’re talking to your kids about a low-key holiday season, focus on some of the exciting activities they’ll get to participate in and people they’ll see. If they’re making a list for Santa, encourage them to add lower-cost items like art supplies. I’m a mother, too, and your kids will understand your frugality, especially if you can foster a sense of hope that better financial times are ahead … believe me, they are!
Decide today that going into debt isn’t even an option.
There is nothing worse than opening your digital credit card statement the second or third week of January to discover you have a massive balance owing and no means to pay it back. It’s a major contributor to Blue Monday (Jan. 16, 2023), the lowest emotional and financial point for North Americans.
Take your financial power back right now and decide you’re not going into debt for the holidays — not an option. Now, write this goal down on a sticky note and place it somewhere highly visible, like your bathroom mirror.
Now, let’s make a plan to make this season magical … and frugal.
Gifts: Make that list. Check it twice. Trim it by half. You do not need to buy or make presents for everyone. Make arrangements for Secret Santa exchanges or stockings only. I know of a number of families who are doing re-gifting only this year. Homemade crafty gifts inspired by sites like Pinterest and Etsy are a cool trend — wreaths, cookie mixes and more. And the second-hand market is another fantastic place to source meaningful gifts like books and bikes for people you love. While you’re at it, you might as well purge and sell anything you don’t need, and raise money for your holiday season. Popular sites for that are Kijiji and Facebook Marketplace. Use up loyalty points and partly used gift cards for gifts.
Parties, fashion and decorations: Choose not to buy another outfit. Swap or borrow with friends. Wear something you haven’t for a while (remember, no one remembers your pre-pandemic clothing). Make your own ugly sweater with pipe cleaners, tacky ornaments and googly eyes. If you’re hosting, set expectations around everyone contributing food, drink and games. And, if you’re a guest, show up with a bottle of wine you can afford (aim for under $15) plus a heartfelt homemade card and gift. I love giving people cards my toddler and baby made. They are notable, adorable and always make it to a mantel or the refrigerator. Say no to any new decorations and use what you have.
Events and outings: Make a concerted effort to only participate in activities that cost nothing. Skating parties, free winter festivals, carolling, petting zoos, guided forest walks and more. And, if there is a paid activity you absolutely must participate in, search online for a coupon or discounted deal like two tickets for the price of one.
All things food: Baking supplies, turkeys, coffee liqueurs and more. It all costs considerably more now … and don’t even get me started on the wild increases in restaurant and takeout prices. This is where planning ahead, and starting now, really pays off. When flour, sugar and butter go on sale, pick those items up. If you can grab a discounted turkey, ham or fish, buy and freeze it. Only buy liquor that is on sale and in modest quantities. Use coupons and price matching for everything you buy. The three biggest savings opportunities (about 35 per cent savings) will be from making your own meals rather than going out, shopping at a discount grocer and making a food plan for the holidays so that you buy only what you need. If you must meet a friend at a restaurant, make it a drink or coffee rather than a full meal.
Look out for these pesky costs when you are shopping.
Try to avoid high shipping fees, delivery and fuel surcharges, credit card fees, exchange rates and “fake” sales; those are flashy sale signs but the actual product or service cost hasn’t really changed. The real deals that happen around Black Friday and Cyber Monday are comparable to, and sometimes better than, Boxing Week specials. But, the only way you’ll know that you are for sure getting a better price is if you are watching the pricing now and can compare the sale price.
It’s a great idea to get in the spirit of the holidays now. The more planning and spacing out of your costs, crafts and activities, the better quality season you’re likely to have. So, enjoy yourself and dig those decorations out of your garage. And remember: this too shall pass.
This article was originally published in The Star. Lesley-Anne Scorgie is a Toronto-based personal finance columnist and a freelance contributing columnist for the Star.