Holiday shopping season is upon us… According to a Black Friday survey, and the average shopper spent $423 this long weekend. Another National Retail Federation survey reported the average spending per person in 2011 was about $704. (They also spent $130 on themselves.)
Although I still avoid crowded malls like the plague, I’m not one of those Scrooges that say that you should say “sorry, I’ve gotten myself into some debt, so this year I won’t be giving any gifts”. There’s no need to spend lavishly, but even if things are tight, gift-giving should be something that you planned for ahead of time. Otherwise, unless you live like a miser, what you’re basically saying is “I prioritize giving stuff to myself higher than giving to others.”
In reality, my main problem with gift-giving is dealing with all the extra entropy generated. You get all this stuff, a certain percentage of which is useful and the rest that isn’t. Therefore, in addition to saving money, my “battle plan” includes trying to reduce the chaos and clutter inherent in the gift-giving process.
Use up all your gift cards. Every holiday season, we are lucky to receive a number of gift cards. A year later, a chunk of those gift cards still sit unused. Since I already had an entire year to use them on myself and didn’t, the new mission is to use up all those gift cards to buy other people gifts before the next wave comes in. If all else fails, I try to force myself to sell them for cash at a gift card vendor. Run your own gift card price comparison like I did, or use a site like GiftCardGranny.com.
Get 5% back on all online purchases up to $1,500 from Discover. I do all my shopping online anyway. See here for details.
Buy discounted gift cards first. For large purchases, consider buying a discounted gift card to the store where you’re shopping (with a rewards credit card of course), and then use that gift card immediately to buy the final gift. You can even buy them while in the store from your smartphone. Don’t do this unless you are sure you’re going to shop at that store.
Redeem all those points you’ve been meaning to use. If you read this site, then it’s quite likely you have a stash of points somewhere. Earn ‘em and burn ‘em! Citi ThankYou points, Chase Ultimate Rewards points, American Express Membership Rewards points, Discover Cash Back or other balances that you need to request, and so on. The best redemption rates are usually for either a gift card or cash.
Sell your stuff. Really, actually sell it, not just think about selling it! Use your gift-giving urge as motivation to sell your old stuff. I know, it’s hard. Try selling electronics and popular items with an Amazon Seller account, you’ll get a better price than selling to a business, but it’s a little less crazy than eBay. Use the proceeds to pay for gifts or donate to charity. If you want zero hassle, run a sellback price comparison like I did for an old iPod Touch.
Cash Back portals. Cashback portals have become very popular, and most are having promotions right now which vary day-to-day. Sites that I have regularly use and cross-compare are eBates ($10 new user bonus after any purchase of $25+), Mr. Rebates ($5 new user bonus – minimum cash-out balance is $10), BigCrumbs (no bonus, but often offers the best payouts), FatCash, and Chase Ultimate Rewards mall (need appropriate Chase card). You can even earn cash back from Amazon and eBay now in certain categories. If you use these places, don’t forget to request a payment!
Credit card bonuses. Around the holidays, the banks usually have some new offers to grab us customers. Remember, use these loss leaders for your own benefit by never carrying a balance! I usually go through another wave of applications near the end of the year, all on the same day with different browser windows. Recently there are some new offers that I may jump on – 40,000 Thankyou points = $400 from Amazon from Citi, 50,000 American miles from Citi (100k if you do the business version too), $800 in Southwest Airlines airfare from Chase, and 50,000 points = $500 in gift cards from American Express.
All together, I’m sure I could scrounge up $704 with these tactics, counteracting both the cost and clutter of gift-giving. I’ll certainly be happy when I am done with shopping, though. Got some other ways that you help offset the hit from the holidays? Share in the comments below.
By Jonathan Ping | Frugal Living | 11/25/12, 7:33pm