Sense & Centsibility Blog
Multiracial group of four women shopping together and lookng at what one of them has purchased

Planning your holiday spending in July to avoid debt

I know what you’re thinking. No, not holiday shopping! It’s too early; it’s not even Labor Day yet! It’s not like you’re going to forget about buying gifts, right? But please, bear with me as I share reasons and tactics for holiday spending in the summer.

When I was in my late teens and early twenties, my friends and I would spend our summers working in Jackson, Wyoming, just south of the Grand Teton and Yellowstone National Parks. Over the course of the summer, we would reunite with old friends and make new ones (there were many repeat summer workers in the area). Many of those we met worked at the resorts in the parks. It was through them that I first learned about a traditional celebration called Christmas in July. They would celebrate then because they had become like family and wouldn’t be able to celebrate together after everyone went back to where they lived.

I’m not writing this blog to suggest that you, too, should celebrate your holidays in July, but as we experience the hottest weeks of the year now, I remember those days, and it makes me think about the holidays. December’s cold and snow might seem an eternity away, but in reality, there are only 153 shopping days from July 25th to Christmas Day, 146 until the start of Hanukkah and 154 until the start of Kwanzaa! That’s just ten paychecks if you get paid twice a month.

I know, I know. I don’t want to think about it, either, but indulge me for one more moment. Depending on which source you consider, the average American household spends somewhere between $1,000 and $1,500 on the holidays — a figure that includes gifts, food, outfits, events and dining out. Where do you fall in that range? Have you ever determined how much you spend on the holidays or made a plan for what you will spend? With inflation so high this year, it might be a good time to start thinking about and planning earlier than usual to avoid credit card debt. Why not start thinking Christmas/Hanukkah/Kwanzaa in July? Here are tips to get you started.

Make a List

Santa doesn’t have to be the only one who makes a list and checks it twice. You might not care about who has been naughty or nice, but making a list of whom you will be purchasing gifts for this year - including how much you want to spend - is the best place to start planning.

However, don’t stop with gifts! Consider all the things you typically spend money on during the holidays, and start estimating those expenses. Don’t forget to include food, adult beverages (if needed), dining out, decorations, new outfits, concert or event tickets and any other typical costs for those celebrations. How much does that add up to? Do you need to sit down and take a breath?

It’s wise to have a plan for covering holiday spending without going into debt. If you don’t have a plan, here’s how you can start.

Divvy It Up

As I mentioned above, if you get paid twice a month, you have ten, maybe nine paychecks until the holidays (depending on the dates you get paid). If you tally your expenses above and divide that number by nine, you will know how much you need to save each paycheck to cover your planned expenses.

For example, if your total was $1,000, divide that by nine and you get $111. You will need to save that $111 from each paycheck to cover the $1,000 in extra spending. I suggest setting up a direct deposit from your paycheck to a specified savings or checking account. That way you only make the decision once to save instead of doing so each paycheck.

Check That List (Twice)

If you want to avoid taking on debt for holiday spending, and the amount you need to save each paycheck is too high for your current financial situation, there are steps to take and choices to make. First, determine an amount that will work for your current situation. If saving $60 per paycheck is possible, you will still have $560 to spend!

Once you have determined what amount will work, go back to your list, and choose which expenses you can cut. This is not easy. It might mean giving up traditions, reducing what you typically spend on gifts, giving gifts to fewer people or giving fewer gifts overall. Maybe it means not travelling over the holidays. It’s up to you to determine what the most important expense(s) are — what you can and can’t live without.

Start Now

Most Americans start their holiday shopping in November, yet deals can be found year-round! If your budget is tighter than usual this year, that doesn’t have to mean doom and gloom. Maybe instead of saving your money each paycheck, you use a bit to buy gifts periodically from now until December. That could be a great way to find good deals and still avoid debt. Perhaps you split it up and save some and spend some each month. The most important steps are making that list, prioritizing what is most important to you and sticking to your plan.

Watch Out for Scrooge!

Despite the best laid plan, you might end up with some holiday debt. It happens to the best of us. If you do, don’t be too hard on yourself. It’s easy to get caught up with the excitement and thrill of the season. If you take on some debt, make sure to use our Scrooge-O-Meter to see how much that debt will cost you.

If you’re still paying off last year’s holiday spending and want to learn about options to make more progress towards reducing debt, talk with one of our trusted, nonjudgmental LSS financial counselors. They can work with you on a plan to eliminate last year’s debt and a spending and budgeting plan for this year’s holiday season, too! Call 888.577.2227, or get your support online.

Shannon Doyle


Author Shannon Doyle is Program Manager for Partnerships and Financial Education for LSS Financial Counseling.