5 Practical Tips to Budget For the Holidays in a Pandemic Year


by Ellen Blake

A Longer Holiday Shopping Season This Year

The holiday season feels different this year – because it is different. For one thing, it’s twice as long. Covid-19 forced retailers to make changes to their holiday sales cycle, which affects how we shop. The “special” deals started much earlier than usual. As if the holiday season isn’t stressful enough in a normal year.

In some ways, this shift to a longer season is good for a pandemic year.  The earlier deals reduced crowds in physical stores and help ensure customers’ items ship on time online. The extra time helped planners who like to buy gifts in advance.

I appreciate the option to shop safely and early. But how do you make this longer holiday season work for you if you don’t have a well-prepared budget? A lot of us experienced dramatic changes in our finances this year, which can seriously dampen our holiday spirit. A survey by professional services provider, PwC, found that 40% of people plan to spend less on the holidays this year than last compared to 14% in 2019. 

Right now, holiday celebrations seem low on our priority lists. That’s definitely true in my case. My anxiety level is high due to the pandemic-related uncertainty I feel related to health, money, retirement, and beyond.

Holiday Shopping During Covid-19 With a Limited Budget

While I admit Covid-19 curbed my enthusiasm for the holidays, I still want to shop for presents. I enjoy gift-giving, especially when I find that perfect little something. Retail therapy is a great distraction, especially when I am safely in my home in comfortable clothes. What makes this year more challenging though is the need to stay carefully within a limited budget.

Paula Weiss, an independent financial advisor, gives this advice:

“As you begin the planning and shopping for the holidays with the cloud of COVID-19, STOP, close your eyes, and take a deep breath. There is a light at the end of the tunnel, as numerous therapeutics along with vaccines are a whisper away from being available to the public.

Acknowledge which personality controls your holiday budget – the Grinch or “unabashed” Retail Therapy Shopper? Both approaches are justified, but something in the middle is also an option. What is the “middle” option? Limit your gift-giving to those most important to your life. Make your presents personal; give them a gift that they will treasure forever. One that makes them smile and think of you whenever they see it.”

I love this advice and agree it’s best not to be too extreme one way or another. Below are some additional tips that might help with your holiday shopping this year.

Tips to Budget for Holiday Gifts in a Pandemic

Here are some tips for shopping for holiday gifts in a pandemic that we hope are helpful.

Roll with it.

Don’t let frustration or negativity dampen your holiday spirit. Know this holiday season is different than previous celebrations due to the pandemic, but it can still be fun.  Have an honest conversation with family or friends about expectations for this year. A discussion of how much you can comfortably spend helps set the tone and prevent misunderstandings.

Rethink priorities.

If your income changed this year, as mine did, you may not have savings you can access easily to help purchase your gifts. If gift-giving is important to you, you might find ways to save in other ways to free up some extra cash. For example, look for ways to reduce expenses right now. Call your cable or internet company to try to renegotiate your package. See if you have unused gift cards in your drawer which you can use. Check your credit or debit card to see if you have rewards available that you can convert to gift cards or cash.

Eliminate phantom charges on credit/debit cards.

This is a good time to look for charges you might not remember you had. I found numerous recurring expenses on my credit card from memberships I forgot to cancel after the free trial ended. These costs are often small by themselves, but if you have $10/month in memberships you don’t use for twelve different accounts as I did, those small amounts add up. I used this money to buy gifts once I canceled these memberships.

Adjust the scale of your traditions.

Consider a smaller-scale gift exchange this year. A Secret Santa or white elephant exchange can be lots of fun and take away some of the stress. Agree on a spending limit and purchase one gift instead of one for each person. Make sure everyone understands the importance of the spending limit as not everyone can participate on the same level. You might even want to encourage handmade gifts or “coupons” to give the gift of service around the house for thoughtful and much-appreciated gifts in place of store-bought presents.

Look for good deals, but don’t go crazy.

We all like to save money. It’s important to be diligent in your research but try to keep in mind that if you obsess about it, you may become overwhelmed. When you find a good deal, buy it. Extra time spent trying to find a better price may save you a few dollars, but it’s not likely to net significant savings. Don’t add extra stress unnecessarily to your life.

The Bottom Line

Your wallet may be slimmer this year, but the holidays can still be special. Hopefully, next year will be more “normal”, or a new normal anyway. But for this year, find a unique and memorable way to celebrate. And please share your plans with the rest of us in the comment section below!


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