19+ Easy Ways To Avoid Holiday Debt

15 Ways To Avoid Holiday Debt

The holiday season is the most wonderful time of the year. But it is also the most expensive time of the year, as the cost of gifts, decorations, holiday parties, and meals all can add up and push some people into debt.

The holiday season is a time for giving and spreading holiday cheer, but for many of us, it can be challenging when our bank accounts take a hit. The cost of presents, travel, food, and parties can put a strain on your wallet. 

From buying gifts to attending holiday parties, trying to cover the holiday costs can be a real sense of dread for many families, as the expenses add up quickly. Many people get into bad debt due to their expenditures at Christmas.

But there are ways to enjoy the holidays without going into debt. This article will show you 15 ways to avoid holiday shopping debt. These include planning for the holidays correctly, saving early enough for the holiday season, shopping in the sale, and much more.

1. Set A Budget

When it comes to the best ways to avoid holiday debt, you first need to set a budget. Create a festive budget to avoid overspending. A budget will help you stay on track when spending. Take a look at your savings and see how much you can afford to spend at Christmas. Set your holiday budget based on your available savings to avoid debt.

If you have been saving for the holiday shopping season, it will be easier to set a holiday budget. But if you have little or no savings, figure out how much you can realistically afford to spend on all holiday expenses. Then look for ways to save that amount or earn that amount between now and December, so you do not have to borrow that money and get into holiday debt.

Set up your holiday budget based on how much money you have already set aside, or you will have saved up before the holiday season rolls around.

2. Create A Holiday Spending Plan And Stick To It

You will need to create a spending plan. This is where you budget for everything you plan to spend money on, such as gifts/presents, food and drink, parties/socializing, travel, outfits, etc.

You may include the following expenses in your spending plan for the festive season:

  • Gift Purchases
  • Decorations
  • Food and drink
  • Christmas and New Year events and parties
  • Travel expenses
  • Wrapping paper
  • Christmas cards
  • Charity Donations
  • Any other holiday-related costs

Make a list of people you plan to give gifts to and allocate an amount for each person to spend. Assign a specific amount of money to each of the holiday expense categories.

Now add up all those costs and then look at the final number. If it exceeds your budget, find ways to reduce your holiday spending to help meet the budget.

3. Trim Your Holiday Spending Plan

Do not exceed your holiday spending budget. If your expected holiday expenses exceed your budget, you must find ways to cut spending. First, prioritize the expenses based on the order of importance. For example, you may choose to purchase gifts only for the kids. Maybe you can buy less expensive gifts for your family members.

You can save a lot of money if you do not send holiday cards. You will need to cut some things that are not important to ensure that you are not exceeding your holiday budget.

4. Track Your Holiday Spending

Now that you have set a spending plan that meets the budget, keep track of every single purchase. If you do not track every purchase, you will overspend. It is easy to get carried away at Christmas and spend more than you can afford. Tracking your holiday spending will help you stick to your budget, so you do not overspend.

Track your holiday spending to ensure you are not spending on anything that is not on the list, and avoid spending more than you have budgeted for an individual or item. When you spend money on anyone or anything, make sure to subtract the amount from the total figure and from the individual category. Then, if you track your spending, you can adjust certain categories according to your budget.

5. Set Money Aside For The Holiday Spending

top ways to avoid holiday debt is to set money aside for purchases

Many of us rely on our credit cards to cover our holiday expenses and end up getting into holiday debt. But if you budget for holidays and set a small amount of money aside in savings every week or month, you can stay out of holiday debt and save money on interest payments on your credit card debt.

Depending on how much you can afford to save each week or month and your holiday budget, you may be able to save all the money you will need for all your holiday expenses before the holiday season rolls around.

But if you have not started saving for the holiday season, calculate how much you plan to spend. Then determine where that money for your holiday spending will come from between now and December. Finally, you will need to either save that money by cutting your spending or make that money by increasing your income.

6. Cut Spending

Suppose you see you do not have much money left in your cash reserve after paying bills or making credit card payments to save for the holiday season. In that case, you can temporarily cut out some costs on entertainment, dining out, and other discretionary expenses (e.g., for a couple of weeks or months).

You can put the savings towards your holiday spending fund. You may be able to save a few hundred dollars by cutting out some nonessential expenses.

Maybe, you can stop buying that daily takeout coffee for a month or two. You can save money if you do not go out regularly for dinner in a fancy restaurant. Cancel your gym membership if you do not use it much or at all. Instead, you can do exercises at home. Cut the cable if you do not watch much TV, and go for a cheaper alternative, like a streaming service. You can also downgrade your internet and phone packages to save money.

7. Start A Side Hustle To Earn Extra Cash

Start A Side Hustle To Earn Extra Cash

Suppose you think you will be short on cash during the holiday season. In that case, you can look for ways to earn extra cash to cover your holiday expenses instead of borrowing money to cover those expenses and getting into holiday debt. There are plenty of ways to earn extra cash during or over the holiday season. Here are a few ideas on how to make extra money for the holiday season:

8. Offer Holiday Shopping For Others

If you have some free time and a knack for shopping, you can get paid to do other people’s Christmas shopping. You can purchase holiday gifts or groceries/food online or at stores for them. You can charge the client hourly or flat rates for holiday shopping trips. You can ask around your neighborhood to find clients or advertise your service on the noticeboard of shopping centers.

Another option is to join one of the online delivery platforms to find grocery/food delivery jobs online, such as Instacart, Shipt, Postmates, GoPuff, Uber Eats, and DoorDash.

9. Offer Holiday Cleaning Service

If you love to keep your own house clean, you can earn some extra cash fast for the holiday season in your spare time by providing house cleaning services to busy people or those who hate cleaning their homes.

You can offer your services to neighbors. Advertise your services on social media, via word of mouth, or by creating flyers or business cards to post on local notice boards. Another option is to join an online platform that lists house cleaning jobs near you during the holiday season, such as TaskRabbit, Handy, and Thumbtack.

10. Become A Holiday Babysitter

Many parents look for reliable babysitters during the holiday season as they have to attend parties and go shopping. If you love kids and are friendly and responsible enough, looking after children while their parents are away or busy at work could be the perfect side job for making extra money fast during the holiday season.

11. Sell Used Or Unwanted Items

One of the fastest ways to make some extra cash during the holiday season is to sell your used or unwanted items at a yard sale or online using sites like eBay, Craigslist, Facebook Marketplace, and OfferUp. You can also sell used items via some apps like Poshmark, tredUP, Decluttr, etc.

12. Become A Pet Sitter

If you love spending time with animals and are looking to make some extra money on the side for your holiday spending, then you can offer pet-sitting services. For example, many pet owners go away on vacation and need someone to watch their pets. Another option is to walk other people’s dogs. You can ask around your neighborhood or join pet care or sitting sites to find pet sitting or dog walking jobs, such as Care.com, DogVacay, UrbanSitter, DogVacay, etc. You can earn up to $15 per hour or more as a pet sitter or dog walker.

13. Do It Yourself

One of the ways to avoid holiday debt is to get creative with your gift-giving. You do not have to buy expensive gifts for everyone on your list. Instead, get creative.

A more affordable option would be to make a homemade or handcrafted gift which can be much less expensive than something you would buy at a store or online, but it can be just as meaningful as something you would buy at a store or shop. So, you do not need to break the bank when buying meaningful gifts for everyone on your list.

There is no rule that you have to buy expensive gifts for everyone. Instead, buy what you can afford and get creative to craft, sew or bake gifts for your family and friends to avoid holiday debt. So, if you are crafty, try to see if you can make some of your own holiday decorations or gifts to save cash and avoid holiday debt.

14. Take Advantage Of Credit Card Rewards

use credit card rewards to reduce holiday debt

Many credit card companies offer special rewards during the holiday season. For example, some credit card companies offer 0% interest deals on purchases, where you pay for a product over a period of time with no interest. If you think you will be short on cash, it will help you break up your costs into manageable monthly payments you can pay off before the interest-free period ends.

So, you might choose this option to avoid holiday debt. Also, you can earn a chunk of cash back on credit card rewards. So take advantage of cashback credit card rewards but make sure you are able to pay back all your credit card bills at the end of each billing period. 

Although it is still a form of debt, an interest-free deal on purchases will allow you to pay off the debt with no additional cost before the deal ends. So make sure you take advantage of 0% interest finance deals for planned purchases.

15. Borrow Decorations

If you borrow decorations, you can reduce costs for holiday parties since you do not have to buy them new. Another option is to buy something new that can be used again for future parties. You can save money if you purchase holiday décor, lights, and gift wrap when they are on sale at the end of the season for the following year.

16. Organize A Gift Exchange

It is easy to overspend during the holidays when you buy something for everyone. Instead, arrange a gift exchange with family, friends, or co-workers where you have everyone draw a name out of a hat and buy a gift just for that person. This will reduce the total amount you spend on gifts.

17. Shop Online First

Before hitting the mall, see if shopping online might save you time and money. If you buy something online, you can find special offers like online-only discounts to save money. It could be eligible for free shipping too. If you use a cashback app or website when you purchase something online, you can earn cashback shopping online to save some cash on your purchases. You could also get coupons online to save money on your purchases.

Another way to save money with online shopping is when you leave items in your shopping cart. Online retailers or stores often offer consumers discount codes for items left in their cart to encourage them to buy those items. Shopping online also makes it easy to compare prices. You could also save money on gas when shopping online.

18. Shop Early

One of the ways to avoid holiday debt is to buy early. Many retailers and stores offer great deals on toys, gifts, and other items before Christmas. So, if you shop early, you can save a lot of money by taking advantage of these deals.

Products like electronics and home appliances will be marked down to Black Friday prices in early November. So you can save money if you buy these products around that time. With a bit of careful planning, you will have more time to browse offers and compare prices. Plus, you can also avoid crowds.

19. Shop Around

You can avoid overspending at Christmas if you shop around for the best price for gifts and food and pretty much anything. Shopping online or in cheaper discount stores can be the best way to check out the differences in costs between retailers easily.

When you want to buy anything on the list, do not just buy it from the first store you visit. Instead, take some time to compare prices and see if you can get it cheaper elsewhere. Use shop comparison sites to compare the prices of the same item to find where you could get it for a lower price. So, make sure you shop around. Look for sales and discounts before you make your holiday purchases.

20. Shop On Sale Days

Shop On Sale Days

You can save some serious cash if you shop on the sale days during the holiday season or as early as the summer sales or during Black Friday or Cyber Monday. The savings you make could be put toward other holiday costs, thus avoiding any potential holiday debt if you were to borrow money to cover those costs.

In addition, prices of many seasonal items drop considerably after the holidays. So, you can save a lot of money on items you buy after the holidays to use next year.

Do not buy something just because it is on sale. Furthermore, do not just limit yourself to seasonal sales, as you may find a better and more affordable Christmas gift at its regular retail price.


We hope the tips above on 15 ways to avoid holiday debt will help you enjoy a debt-free holiday season. Do not get yourself into holiday debt for the sake of the festivities.

Instead, with a little planning and discipline, you can stay within your budget, enjoy the festivities, and spend quality time with your loved ones without the financial stress that comes with the anticipated costs of holiday debt. Then, start saving for the next holiday season when the new year begins.