17 easy ways to raise holiday shopping cash
You could easily save several hundred dollars or more before the end of the year by implementing several of these tips. Nothing sweeter than a debt-free holiday.
This post comes from Marilyn Lewis at partner site Money Talks News.
If you woke up after the holidays last year with an overspending hangover, or you're wondering where you'll get money for gifts this year, this article's for you.
To give the gifts you want without money stress, start saving now. A fat holiday shopping fund lets you enjoy a season that's both affordable and inner-peaceful.
"More than 90 percent of Americans celebrated Christmas, Kwanzaa or Hanukkah last winter," says the National Retail Federation, adding:
In 2013, holiday celebrants spent an average of $730 on gifts, food, decorations and more. After all was said and done, NRF found that holiday sales increased 3.8 percent to $602 billion.
Here are 17 ways to fund your gift shopping without feeling much pinch at all. We also estimate the amount of money you can save between Labor Day and New Year's Day by following these tips. (If you're pinched for money, here's more help on how to trim your spending on gifts.)
1. Stop lending to Uncle Sam: $1,000
If you get a fat tax refund each April, you're giving the U.S. government an interest-free loan. Stop that. The average refund is about $3,000. Put that money in your paycheck instead, suggests the National Foundation for Credit Counseling. An average refund, spread over a year, is $250 a month. Put that into savings now, and you'll have $1,000 for gifts by year's end.
Here's how to change your W-4, the IRS document that tells your employer how much to withhold from your paycheck for federal income tax, to more accurately reflect the tax you'll owe at year's end:
- Gather your paycheck stubs.
- Use this IRS withholding calculator to find your correct withholding amount.
- Fill out the form (at IRS.gov).
- Give the completed form to your employer's payroll department.
2. Start a Christmas Club: $400
Money Talks News' Donna Freedman describes this time-honored way to save for holiday gifts:
Back when the Earth was still cooling, my mom had a Christmas Club. The workplace credit union took a certain amount from her paycheck each week so that she and my dad could pay cash for all of those bikes.
Open a bank account just for this purpose and set up an automatic monthly deposit into it. Save $100 a month, and you'll have $400 by the holidays.
3. Clean house: $100 to $400
Gather up gently used clothes, sports equipment, musical instruments, books, furniture, electronics, dishes, antiques, movies and video games you no longer use. Let someone else enjoy them while you fatten your holiday fund. Before holding a yard sale, try these ways to get top dollar for used items.
4. Make micro trims: $400
Pick 10 monthly expenditures that have some flexibility, such as dining out, groceries, snacks, clothing, gas, and entertainment, suggests the NFCC. Spend $10 less each month in each category. You'll hardly notice the difference. Put the $100 you save each month into your holiday fund.
5. Earn extra cash: $400-plus
Think about what you can do to make extra money before the holidays. You might like walking other people’s dogs or even caring for them in your home, for example. You also could turn your hobby into a small business, tie fishing flies, deliver newspapers, drive a school bus or work as a customer service representative. Here are 22 ideas for scaring up cash.
6. Put your phone bill under a microscope: $120 to $200
Take a good look at your phone bill, or call the phone company to get a representative to go over it with you. See if you really are using the minutes and data you are paying for. If not, drop your plan down a level and put the money saved into your holiday fund.
Even if you are using all those minutes and gigabytes, could you cut back a bit and save? If you can slice $30 to $50 a month off your phone bill, that's $120 to $200 by the end of the year.
7. Drop your landline: $400
Are you are ready to lose your landline and use your mobile instead? If attachment to your old number is stopping you from letting go, you may be able to transfer the old number to your cellphone. Ask your phone company about "porting" a phone number. There's $100 or so in savings, $400 by year's end, into your holiday fund.
8. Drop your gym membership: $232
If you're like many gym subscribers, you are not getting your money's worth out of the membership. Recommit to exercise -- for free. Try these ideas:
- Find free gear and workout videos on Freecycle (make a request for items you are looking for).
- Dust off your bike and climb aboard.
- Get a buddy to commit to walking with you.
- Buy a cheap pedometer and record your daily mileage. You don't need to walk 10,000 steps a day. Pedometer "numbers as low as 6,000 steps a day were shown to be correlated with a lower death rate in men in the Harvard study," says About.com.
If you can't let go of the gym membership yet, take a break. Some gyms let members take one to three months off a year, meaning that you skip those months' payments and stay away from the gym.
Typically, gym members use their facility twice weekly, on average, spending $58 a month for the privilege, according to Statistic Brain. Savings: $232 by year's end.
9. Cancel collision coverage on your old car: about $80
If you're driving an older vehicle, you may be able to save by dropping the collision and comprehensive auto coverage, which pay to repair or replace a vehicle if it is stolen or vandalized or if you're at fault in a collision.
Note: Do not under any circumstances cancel the liability portion of your policy. You'll need that if you hit someone and hurt them and must cover their repairs and medical expenses.
Here's a CarInsurance.com rule of thumb for deciding whether to drop the coverage:
CarInsurance.com consumer analyst Penny Gusner says she looks less at the cost of coverage than at the value of the car. "If you wouldn't repair it for a major mechanical issue, you probably shouldn’t insure it for comprehensive and collision," she says.
Find your vehicle's replacement value at Kelley Blue Book.
Also, compare the cost and value of keeping only the comprehensive portion and dropping collision coverage. It is less expensive than collision and "covers your insured vehicle for physical damage losses resulting from incidents other than collision," says CarInsurance.com. For example, if a rock hits your windshield, comprehensive coverage kicks in.
Comprehensive and collision coverage costs about $242 a year for a 40-year-old Delaware resident who has a clean driving record and drives a 2002 Chevrolet Impala LS (worth about $3,650) in good condition, CarInsurance.com says. So that's a savings of about $80 over four months.
10. Raise your car insurance deductible: $30-plus
Raising the deductible amounts on your car insurance policy from, say, $250 to $1,000 can save you $100 or more a year, depending on factors like the age of your car. That can save you about $30 or more over four months.
And that's just auto insurance. You can save a lot more by raising the deductible on your homeowners or renters insurance. Just make sure you have enough money in your emergency fund to cover the deductibles should disaster strike.
Here are five more ways to save on your auto insurance.
11. Take a credit card holiday: $160
Credit cards make it easy to charge mindlessly. Put your plastic in a drawer until the first of the year. Do all of your shopping with cash until then. How much you save is up to you, but you're sure to slice at least $40 a month off your spending.
12. Take a brown-bag lunch: $330
If making lunches isn't your thing, don't worry. This isn't a lifetime commitment. For a few months until the end of the year, cut out restaurant food and take your lunch to work. You might even grow to like the money you save.
Workers who go out to lunch spend an average of nearly $1,000 a year. You have 16 weeks before the end of December, during which you could save $330. Brown-bagging is easy once you get into the groove of planning, shopping and making it the night before.
13. Rein in your latte habit: $330
Those who regularly buy coffee spend an average of about $1,000 a year. That's another $330 you could save by year's end if you start in early September.
14. Redeem unused gift cards: $30-plus
If you have unused or partially used gift cards lying around your home, you're not alone. About $1 billion in gift cards will likely be lost, will expire or will not be fully used this year, according to research company TowerGroup.
Why not take those orphaned cards and turn them into cash? Gift Card Granny is an aggregator that lets you find and compare the rates certain sites will pay for your old cards.
15. Quit smoking: $600
Get a jump on your New Year's resolutions by quitting your tobacco habit right now. If you are a pack-a-day cigarette smoker, at $5 a pack, you're spending $1,825 a year. That's about $600 you can save by New Year's Eve.
To find your potential savings, use the American Cancer Society's smoking cost calculator.
16. Cut the cable: $284
Dumping cable TV is an increasingly attractive option. You can pick up HDTV on local stations for free with an antenna, watch plenty of shows for free online and, with a subscription to Netflix, Amazon Prime or Hulu Plus, stream all the movies and premier TV shows you can watch.
The average cable bill is about $80 a month, including taxes. Subtract $9 a month for a Netflix streaming account, and the average household stands to save $284 in four months.
17. Trim your takeout habit: $320
In an ABC News Real Money story, food blogger Evelyn Molina (a self-confessed takeout junkie) compared the cost, in time and dollars, of takeout dinner vs. cooking a simple home-cooked meal.
While Molina's husband spent 31 minutes picking up their favorite takeout food, Evelyn and a professional chef took 22 minutes to whip up a dinner of fish and vegetables at home.
The costs: Takeout meal for the family of three was $22 vs. $12 for the home-cooked dinner.
Using those savings, you could put aside $10 each time you cook at home. Eliminate two takeout meals a week, that's 32 meals between Labor Day and New Year's Day, and you'll have roughly $320 to spend on gift shopping.
What tips do you have for saving up holiday cash?
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