How to Make Holiday Saving and Spending Decisions

There’s a lot you can’t control this time of year.  

From personal ordeals (what dish your daughter-in-law brings to Thanksgiving or how well your children get along during festivities) to professional changes (whether your company gives out holiday bonuses or updates their benefits in the new year) to national shifts (whether the market aligns with expectations or which financial policies change on January 1), you are at the mercy of many things.  

However, there are foundational factors you do control — how you respond, how you plan, and how you save and spend.  

As we mentioned in our article “How to Manage End-of-Year Financial Stress,” dismissing the basics of financial stewardship can make for an unnecessarily tense season. 

How can you make wise saving and spending decisions this time of year?  

Here are three things to remember about your finances over the holidays.

During any given time — on Black Friday or Cyber Monday, at holiday markets, or the next time your favorite store has a Christmas sale — you don’t have to spend money. 

Does that feel too obvious? Not for everyone. Take a look at some of this season’s stats. 

• “A record 183.4 million people are planning to shop in-store and online from Thanksgiving Day through Cyber Monday this year…”¹ 

• “Despite 59% of consumers saying that inflation will probably influence their holiday spending this year, overall spending is projected to increase by 7% to an average of $1,638 per shopper.”² 

• “After expressing record holiday spending intentions in 2023, respondents are yet again planning to up their purchases, [sic] and expect to spend $1,778 (+8% YoY) this holiday season. The uptick in spend is attributed to a rosier economic outlook (+9 PP), perceived higher prices (70%), and an increase in spend by the $100K to $199K income group (+17%).”³ 

• “25% of respondents are planning to host a holiday gathering, willing to spend $261 on average for the event.”⁴ 

Of course, there’s a reason people like seasonal shopping, and spending money during the holidays is hard to avoid. The key is to spend purposefully, not passively.  

For example, “The top reasons consumers plan to shop during this five-day period are because the deals are too good to pass up (57%), it is tradition (28%) and they like to start holiday shopping over Thanksgiving weekend (24%).”⁵ 

In addition, “Of those who are not currently planning to shop during the holiday weekend, half (51%) said they could be convinced to do so if items they want are on sale, if they are offered free shipping or if friends or family members invite them.”⁶ 

Tradition, social connection, and deals are not bad reasons to shop, but remember that you control how much you save and spend, and choosing to do so intentionally (even if it means not spending) is a wise decision, especially if it keeps you aligned with your financial goals and plan.  

If you lean into the spending season, it doesn’t have to look like it always has. In fact, if you spend differently, you are in good company:  

• “With 70% of respondents expecting higher prices this season, all income groups are showing signs of frugality. They’re planning to cut back on self-gifting (-16PP), trade down to more affordable brands (62%) or retailers (48%), and shop promotional events (78% versus 61% in 2023).”⁷ 

• “Consumer spending intentions have evolved significantly since 2015. The proportion planning to spend less has nearly doubled to 29%, while those intending to spend more has decreased to 26% [from 32%].”⁸  

• “Consumers are likely to blend deal-hunting with splurging on select meaningful purchases — balancing budget consciousness with the desire for standout gifts and memorable experiences.”⁹ 

If it’s helpful, go back to the basics and use a budget. 

Wealth Manager McKenna Clifford advises individuals to “Establish a holiday spending budget and stick to it! During the holiday season, among the excitement and countless sales, remember your most important long-term financial goals. By sticking to a budget, you can enjoy the holidays without financial stress and know you are still on track to accomplish your goals.” 

In addition, consider reviewing your Great Goals of Life to see how you might integrate those aims into this season’s saving and spending. For example: 

• If you named that you want to help your grandkids with their education, perhaps you can put money aside for them in a 529 and spend less on their physical presents. (Clifford endorses this option, noting how “This allows gift givers to still win the day with a smaller number of special toys AND make a lasting impact on a child’s future. Their contribution to the 529 may also be accompanied by a tax credit/deduction depending on their state of residence.”) 

• If what you want most from retirement is to soak up the small joys, perhaps you can choose to be content without an extravagant holiday. 

• If you want to travel more in retirement, maybe this is the holiday to finally take a trip or save for the one you’ll take next summer. 

• If you want to retire with a certain amount invested but aren’t there yet, perhaps you can intentionally choose to set money aside this season and invest whatever you save on January 1.  

• If your financial plan designates how much you can give away each year, talk to your advisor about the best, most tax-efficient way to do that over the holidays.  

This time of year, maybe you need the confidence to spend like you always have.  

Trepidation over whether you’re putting your wealth at risk can be alleviated with one simple thing — a plan. 

That’s the beauty of a written plan that accounts for all of your assets and names your goals; it can give you the freedom to make the same lifestyle choices you always have without worry.  

Clifford says, “I take great pleasure in encouraging clients to savor the rewards of their hard-earned savings, particularly during the holiday season. I often pose a question to them: If you are set to achieve all of your retirement goals with funds remaining, would you prefer to spend more of your wealth during your lifetime or pass it on as part of your legacy? Many clients express a desire to gift while their children are young and the impact is most significant, to travel more with their loved ones, and to enjoy more lavish celebrations during the holidays. I remind them that, by using their financial plan, we’ve determined they can comfortably spend more now while still ensuring their financial freedom throughout retirement.”

There is a lot you can’t control this time of year, but your saving and spending decisions are just that — your decisions.  

You might face the same questions as someone else (How much can we donate to our favorite nonprofit? Should we change our holiday expectations? Can I spend like I usually do on Black Friday?) and come away with different decisions based on your personal financial plan.  

The important thing is that you have an answer. Not knowing how to navigate the holidays adds fretting to a season meant to be festive.  

Whether you choose not to spend, not to spend like you always do, or to spend just as much (if not more) than you usually do, your financial advisors can guide you and help you remember that the season is ultimately about so much more than what you save or spend.  

For more guidance on making holiday saving and spending decisions, reach out to our team using the form below.  

Contributing sources:  

1. Granados, W. (2024, November 14). Record numbers of shoppers expected over Thanksgiving holiday weekend. NRF. 
2. PwC. (n.d.). Holiday outlook 2024.
3. McCarthy, B., Skelly, L., Rogers, S., & Raimalani, K.M. (2024). 2024 Deloitte holiday retail suvery. Deloitte. 
4. McCarthy, B., Skelly, L., Rogers, S., & Raimalani, K.M. (2024). 2024 Deloitte holiday retail suvery. Deloitte.
5. Granados, W. (2024, November 14). Record numbers of shoppers expected over Thanksgiving holiday weekend. NRF.
6. Granados, W. (2024, November 14). Record numbers of shoppers expected over Thanksgiving holiday weekend. NRF.
7. McCarthy, B., Skelly, L., Rogers, S., & Raimalani, K.M. (2024). 2024 Deloitte holiday retail suvery. Deloitte.
8. PwC. (n.d.). Holiday outlook 2024.
9. PwC. (n.d.). Holiday outlook 2024.