Start Saving for the Holidays Now

The holiday hangover for many people lasts as long as they continue to pay off their credit card charges from holiday shopping. That can last well into the New Year for some. Instead of paying interest on top of your holiday shopping bills, reverse the process and start saving now for a cash-only holiday account. If you are already on a tight budget, here are some ways to find the money to save.

Hide the Fives

Sometimes the trick is to save without knowing you are actually saving. The age-old approach of putting all your spare change in a big glass jar is one way. You can step it up to the next level by socking away your five-dollar bills whenever they pop up in your wallet. At the end of the day, take your five-dollar bills and stick them in a lockbox. It might only amount to $5 or $10 savings in a week, or it could be as high as $50. The amount is secondary to the consistency of saving, which will pay off in the months leading up to the holiday shopping season.

Take a Spending Vacation

Sometimes it takes a more concentrated effort to save money. If you can stop spending money on everything else for just two months, you might be able to save everything you need. Choose two consecutive months in which you stop spending on everything that is not absolutely essential. Stop buying meals and coffee out. Cut the cable for a couple of months. Bring reusable water bottles to work. Entertain friends with potlucks. Most people would be surprised at how much they spend on non-essentials each month.

Use Rewards Credit Cards

This works best if your rewards are convertible into spending credit or gift cards. Mileage rewards won’t be beneficial. The points can add up quickly if you use your rewards credit cards throughout the year for everyday purchases, such as gas, groceries, and utilities. For the average family, that can add up to several hundred points over the course of the year, which can buy a lot of gift cards.

Live Under Your Means

The best way to find extra money to save is to create a spending plan that enables you to live under your means. That might require additional belt-tightening in both essential and non-essential spending areas. However, if you can find an extra $25 a week through a disciplined approach to budgeting, it is the surest way to achieve your savings goal. The key is to make the weekly deposit into a separate savings account before paying any other bills.