How to make the most of your holiday dollars

11/11/2013 12:00 AM

11/10/2013 2:05 PM

Now that Halloween is in the rear view mirror, all those black and orange aisles of candy, pumpkins and costumes are swiftly being replaced with red and green tinsel, ornaments and Santa everything.

It’s November: Welcome to Christmas season. With retailers already touting their Black Friday sales weeks before Thanksgiving, it’s not too early to arm yourself with a holiday shopping strategy. After all, between the swanky parties, buying gifts for everybody on your “nice list” and traveling cross-country to gather with family, this time of year can do a number on your budget.

Remember those credit card bills from last year that took such a fa-la-la-la-long time to pay off and collected all that interest? Or those last-minute gifts you bought only to find out, once they were wrapped, that they were on sale at another store?

Here are tips to prevent that holiday spending hangover from hitting again this year:

• Study your subjects: Gift guru and author Robyn Spizman said now is the time to start observing those on your gift list so you can give them thoughtful presents. Take note of small details – like whether your friend wears silver or gold jewelry. Does your hard-to-shop-for mom have a favorite salon where she could use a gift certificate? Spizman said we tend to overspend and buy “grab-and-go” generic gifts when we don’t have a plan. The key, she said, to buying perfect gifts is to understand what those on your list value. Writing a complimentary note puts the finishing touch on the gift, she said.
• Buy family gifts: Instead of purchasing individual gifts for every member of a family (which can get super-expensive), Spizman suggested buying a gift the whole clan will enjoy. Maybe a board game they can play together with some packets of microwaveable popcorn for a family fun night? Or, an annual membership to a local museum or the zoo. Another idea? Hire a professional photographer to take a family photo of them.
• Make your credit card work for you: Play a little role reversal with your credit card: Instead of you paying interest, make your card pay you. The key is figuring out what type of purchases you are going to make, and then using the right credit card to maximize your cash back from those purchases, said Erik Larson, president of “For example, many cash back cards have rotating purchase categories each quarter that can earn you 5 percent cash back – versus 1 percent for everything else,” he said. “For October through December, those are often related to holiday purchasing.”
• Stack your credit card rebates with cash back websites: Maximize your credit card cash back rewards by buying through a couponing website that offers cash back to really stack your savings. Add in free shipping and promo sales codes to score even more money off your purchases.
• Pick the right credit card: Always take a realistic look at what credit cards fit your lifestyle, said Charles Tran, founder of, a credit card comparison and financial education website. “If you tend to carry a balance, it’s often better to look for a credit card with a low interest rate instead of a rewards credit card, as interest rates on rewards credit cards tend to be higher,” Tran said. And, if you have a rewards card, make sure you’re accumulating points you will actually use, he said. “There’s no sense racking up airline miles if you don’t fly, and, likewise, there’s no sense racking up a specific hotel brand’s loyalty points if you don’t plan to visit any of their hotels,” Tran said.
• Rack up miles to use during the holiday season: Larson, of, said there are some great deals to be found using travel rewards cards. The Barclay Arrival Card World Mastercard is offering what amounts to a $400 introductory bonus, he said. “It also gives you double miles on every purchase which is the equivalent of 2 percent cash back if you use your miles on travel rewards,” Larson said. “Redeeming them is super flexible and easy.” The Southwest Airlines Rapid Rewards Premier card is offering the equivalent of two round-trip flights when you spend $2,000 in your first three months as a cardholder, he said.
• Reconsider your decorating traditions: We’re going to guess the Griswold family’s epic holiday lights display in “National Lampoon’s Christmas Vacation” ate up Clark’s entire bonus check come January, when the utility bills started rolling in. You’ll end up spending a little bit more for strings of LED lights, but you’ll eventually recoup the expenses as you’ll save on your holiday energy bills over the years. LED lights use much less energy than their incandescent counterparts – which can equate to big savings if you tend to go Griswold and are liberal with the lights. Another plus: LED lights are less likely to break since they’re plastic, not glass.
• Re-gift: A survey last year showed 63 percent of consumers considered re-gifting to be thrifty. (Just make sure you don’t re-gift to the original gifter. Awkward.)
• Buy decorations and wrapping paper on Dec. 26: Gift tags, wrapping paper, ornaments, holiday decorations all go on deep discount the day after Christmas. Even if you’re totally over the holiday, trust us, your future self will thank you.

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