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20 Ways to Save Up Money to Get Ahead of the Holiday Season

According to data from the National Retail Federation, the average American consumer spent $659 on holiday gifts in 2019. That’s approximately 2% of the U.S. median personal income, according to data from the Federal Reserve Bank of St. Louis — no small chunk of change.

For most Americans, completely doing away with the annual holiday gift-giving ritual simply isn’t realistic. At least, not for those eager to remain in the good graces of their friends, relatives, and coworkers.

So, should you resign yourself to another budget-busting holiday shopping season? Maybe not. Snubbing your entire gift recipient list might not be realistic or wise, but trimming that list’s net cost certainly can be. And there’s a surprisingly large number of creative steps you can take to save money for the holiday season — swelling your gift-giving reserve in the (perhaps likely) event that you’re unable to trim as much as you’d like.

Tips to Save Up Money for the Holidays This Year

The secret to saving more ahead of the holiday shopping season, in a word, is: planning.

Virtually all of the tips and tricks herein involve some degree of planning and forethought, whether that means setting up a high-yield savings account months in advance or making sure you’re set up with the perfect money-saving browser extension and rewards credit card when the time comes to begin shopping for the holidays.

1. Make and Build Your Holiday Shopping Budget

Start the holidays off on the right foot with a firm, realistic holiday shopping budget. To create a holiday shopping budget that you can actually stick to, do the following:

  • Set a Firm Spending Limit. Arguably, the most important thing you’ll do in the run-up to the holiday shopping season is pledge not to exceed the firm gift spending limit you set for yourself. Go back through your bank and credit card account history to figure out how much you spent on gifts during the most recent two or three holiday shopping seasons. The average here is a good ballpark estimate for what you should spend this year. Build in a 10% buffer to account for higher-than-expected gift prices or last-minute obligations — there’s always a teacher or colleague you forget until it’s almost too late.
  • Lay Out Your Gift Expenses. Make a rough holiday gift list that includes all known recipients and the maximum you can afford to spend for each. If you know what you’ll get specific recipients, note that as well, the better to begin pinning down pricing.
  • Make Automatic, Recurring Transfers Into a High-Yield Savings Account. The earlier you begin, the better. Ideally, your holiday gift fund would be just another savings bucket to be filled deliberately throughout the year. To maximize your return on saved funds, shop around for a high-yield savings account that pays well above the national average savings account interest rate. CIT Bank is currently one of our favorites.

Holiday Shopping Budget Planning

2. Install the Honey Browser Extension and Enjoy Automatic Coupon Codes on Thousands of Items

Ready to stop worrying about missed opportunities to save once and for all? Download and install the Honey browser extension for free and say hello to the best coupon codes — applied automatically as you shop online — at more than 30,000 retailers. Honey works in the background as you browse, surfacing discounts and deals to which you’d otherwise remain oblivious. A single click applies the best available savings to your order, all without opening a new browser window or leaving the site.

3. Save a Portion of Any Windfall You Receive Between Now and the Holidays

Even if you don’t feel like you’re rolling in it, there’s a good chance you receive at least one budget-boosting windfall each year: your annual federal income tax refund. You might qualify for a state income tax refund as well. Although purchasing holiday gifts might not be the best use of your refund, it’s certainly not the most frivolous use either.

Other possible pre-holiday windfalls might include a workplace performance bonus or end-of-year bonus, an economic stimulus payment, an inheritance or financial gift from a relative, even a lottery win.

After shoring up your emergency fund and paying down high-interest debt — both of which should always take precedence over your holiday gift budget — you can feel comfortable assigning a portion of these windfalls to your end-of-year laundry list.

4. Use Honey’s Droplist to Get Notifications About Price Drops on Wishlist Items

Honey can track prices too. Add specific gift list items to Honey’s Droplist to be notified immediately when advertised prices fall — no coupon code required. You can use this money-saving strategy to save some dough throughout the year and in the run-up to the holidays, and then to find great holiday deals as soon as they come online.

5. Cancel Unnecessary Subscriptions

You don’t need an excuse to cancel nonessential subscriptions that don’t add value to your life. You know they’re a drain on your budget and that the only reason they continue to leach precious dollars from your bank account is the fact that you’re too busy — or, perhaps, complacent — to log in or pick up the phone to cancel them once and for all. But if the obligation to buy dozens of gifts this holiday season turns out to be the kick you need, all the better.

Pro tip: If you’d prefer to have someone else do the legwork to cancel subscriptions, you can use a service like Billfixers.

6. Trim Your Takeout and Dining-Out Budget

Zeroing out or even significantly reducing your restaurant dining budget is often easier said than done. You don’t ever have to go cold turkey on dining out at restaurants or ordering takeout if you don’t want to. But, over time, you can trim your prepared foods budget without dramatically increasing time spent in the kitchen.

For those of us who too readily fall back on weeknight takeout, the entry point is the make-ahead freezer meal: batch meals partially or fully prepared in advance, then frozen for use when you don’t have the time or energy to cook. Portion-for-portion, a freezer meal is likely to cost less than a comparable takeout meal, although the magnitude of the savings is likely to vary.

7. Add a Seasonal Job or Side Gig

Thanks to hundreds of thousands of temporary retail and customer service job openings spurred by swelling consumer spending and travel, the fourth quarter is the best time of year to pick up a temporary job or side gig to pad your take-home pay. Your ideal source of side income depends on your skills, preferences, assets, and schedule, but you’d be remiss not to consider opportunities like:

Whichever you choose, save the lion’s share of your earnings from your temporary gig. Even if you only net a few hundred bucks during the quarter, you’ll have done a valuable service for your holiday gift budget.

8. Sell Some Stuff of Your Own (That You Don’t Plan to Re-Gift)

The fourth quarter is also, arguably, the best time of year to host a yard or garage sale — and certainly the most underrated. Bargain hunters love trawling local sales for rare finds and uncommon deals ahead of the holidays. If you’d prefer not to welcome a crush of strangers to your driveway or front lawn, sell your items piecemeal on Amazon, eBay, Craigslist, or another online resale platform.

9. Learn How Retailers Encourage Impulse Buys (And How to Resist)

This is a year-round asset that becomes extra valuable in the run-up to the holiday shopping season, when every dollar is precious and your gift-giving budget is ironclad. If you really, truly understand how digital retailers and brick-and-mortar stores trick you into buying more, you’ll have little trouble avoiding impulse buys, no matter how tempting.

10. Stop Paying for Shipping (Unless You Absolutely Have To)

As the old saying goes, sometimes you have to spend money to make money. In this case, “you have to spend money to save money” might be more accurate. If you do a lot of shopping on Amazon and often find yourself paying for shipping there, you’d likely save money in the long run as an Amazon Prime member. For a little over $100 per year, you’ll qualify for free two-day shipping on most purchases — and sometimes even faster shipping at no charge — plus a slew of value-adds like Amazon Prime Video.

Elsewhere, familiarize yourself with online retailers’ free shipping thresholds — usually in the realm of $25 to $75 per order — and plan your buys accordingly. Unless you need an item urgently, it’s often possible to avoid paying for shipping.

11. Start Shopping Early

Kicking off the holiday shopping season well before its traditional start on Black Friday serves two purposes for frugal shoppers: spreading the financial pain out over one or two (or more) additional pay periods and bringing early and preseason holiday deals within reach. As you review this year’s Black Friday shopping guide and Cyber Monday shopping guide ahead of your post-Thanksgiving spree, bear in mind that retailers increasingly offer comparable deals earlier in November — giving rise to “Black Friday week” and, in some cases, deals covering the whole month.

12. Take Advantage of Price-Match Guarantees

This is another year-round money-saving strategy that many shoppers don’t fully exploit. As your holiday gift list comes together, complement it with a running list of relevant retailers offering price-match guarantees for similar or identical items. Some of the biggest names in retail, including Walmart and Target, match competitor prices, although these policies do invariably involve exclusions and loopholes, such as exceptions for clearance items.

13. Purchase Refurbished Electronics

Do you really need a top-of-the-line smartphone or tablet when a gently used, fully wiped last-generation model will do? Replacing your aging gadgets with professionally refurbished electronics is the best way to slash your consumer technology budget without adversely impacting performance or device security. On a two-year smartphone update cycle, spending $300 for a refurbished phone instead of $600 for a new one saves $150 per year — a nice boost to your holiday gift budget, if that’s how you choose to spend it.

14. Sell or Trade Old Electronics to Raise Cash and Reduce Net Cost

Selling or trading in old electronics is an excellent way to raise funds for your holiday gift budget, reduce the net cost of electronic gifts, or both. With more than a dozen reputable online resale platforms to choose from like Gazelle or Sellcell, you probably won’t even need to leave the house to sell or trade in your old cellphone, tablet, or laptop.

15. Know Where And When to Buy the Items on Your List

Nearly as important as figuring out what to buy for each recipient is homing in on where and when to buy. For example, warehouse stores like Costco and Sam’s Club tend to offer excellent bargains on limited selections of electronics, appliances, home goods, and clothing. These deals typically arrive well in advance of the traditional start of the holiday shopping season, sometimes as early as September or October. Meanwhile, the dollar store is a fine place to hunt for bargains on cheaper gifts: home goods, clothing, decorations, and the like.

16. Don’t Waste Too Much Time in Line

There was a time when camping out for Black Friday was a foolproof strategy to snag the best deals on sought-after holiday items before someone else did. That time has passed, done in by a combination of long-term factors — the inexorable rise of digital retail — and the near-term shock of the COVID-19 pandemic.

It’s just as well: Camping out in a parking lot is costly, both in terms of the items needed to remain comfortable overnight and the many potentially productive hours spent at the most boring campsite imaginable.

17. Activate Honey Gold and Cash In Rewards for Free Gift Cards

Activate Honey Gold to earn real-world rewards when you shop with more than 4,500 retailers, including heavyweights like Walmart, eBay, and Groupon. Earn up to 20% back on purchases with participating retailers, then cash in your rewards for gift cards to popular retailers, such as Amazon and Target. Don’t quit after the holidays — the more you spend with Honey Gold partners, the more you’ll have in reserve for next year’s holiday gift list.

18. Use the Right Rewards Credit Card for the Right Purchases

The best credit cards to use on Black Friday and Cyber Monday are good, solid credit cards to use at any point during the holiday shopping season.

That said, depending on what you plan to buy and where you plan to shop, you might need to have more than one go-to card in the rotation. The Amazon Prime Rewards Visa Signature Card, which earns 5% cash back Amazon.com and Whole Foods purchases, is an obvious choice for frequent Amazon shoppers, for example. Ditto for other co-branded retail cards, like the Target REDcard Credit Card (instant 5% off qualifying Target purchases) and the Costco Anywhere Visa Card by Citi (2% cash back on in-store and online Costco purchases).

If you can find one, a credit card with price protection is a valuable addition to your holiday shopping repertoire as well. Thanks to competition from apps like Honey, price protection is not as common as it once was, but a handful of credit cards continue to offer it and it’s an excellent way to retroactively capitalize on deals that weren’t available at purchase time.

19. Take Advantage of Retailer-Specific Credit Card Offers

Some of the top credit card rewards programs complement generous and broad rewards categories with narrowly targeted, often retailer-specific offers. Because they’re narrower and usually time-limited, these offers typically earn points or cash back at significantly higher multiples than other purchases — sometimes producing double-digit returns on spending. Chase Ultimate Rewards and Amex Membership Rewards both excel on this front, so if you have a card that participates in either program, don’t begin your holiday shopping spree without investigating how much you could earn.

20. Use Retailer-Specific Tips and Tricks to Save

Finally, take every advantage of well-worn tips and tricks to save at the retailers you patronize most — not only during the holidays but throughout the year too, the better to pad your holiday shopping budget. Just keep in mind that every retailer is different, so you shouldn’t expect your go-to Costco shopping hacks to work at Walmart or Home Depot.


Final Word

Few of these money-saving tips are unique to holiday shopping. For example, using a retail browser extension like Honey is an effective strategy to save money year-round, not just in the run-up to the holidays.

Likewise, many of the tips discussed herein can help consumers like you save for other recurring expenses, such as home improvement projects and vacations. (If you notice some overlap with our guide to saving money for your next vacation, you’re not alone.)

So, however your holiday shopping season shakes out this year, resolve not to pack these tips and tricks away with those festive decorations and extra dinnerware. You’ll need them on the other side of the holidays — and again when the calendar resumes its inexorable march toward Thanksgiving once more.

What’s your favorite strategy to save money for the holiday shopping season?

Brian Martucci
Brian Martucci writes about credit cards, banking, insurance, travel, and more. When he's not investigating time- and money-saving strategies for Money Crashers readers, you can find him exploring his favorite trails or sampling a new cuisine. Reach him on Twitter @Brian_Martucci.

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