two men and two women stand side by side wearing ugly Christmas sweaters

Four festive savings tips

Dec 14, 2020
Empower Insights

How you can create a very merry financial plan for the holidays

‘Tis the season for traditions.

For most Americans, that means it’s the most wonderful time of the year to spend, spend and spend some more.  

On average, shoppers typically shell out more than $1,000 for those must-have toys, goodies and devices each December.That’s whether or not they actually have enough cash in the bank to buy for everyone on their list: Nearly half of consumers will rely on a credit card to help cover their holiday costs in 2020, and over 30% expect to rack up debt just to pay for their festive obligations.1,2

If you want to make spirits bright while also doing your best to manage your money, start by thinking outside the box. With a smart financial plan in place, you can avoid borrowing and keep giving all winter long.3

As you’re getting ready to trim your tree, here are several simple steps you can take to trim your expenses as well:


While everyone loves receiving and opening a special package, not every gift has to be delivered in physical form.

Instead of purchasing material things for your extended family members and your closest peers, schedule a fun video meeting with the entire group. After all, virtual events have become the new fashionable trend for connecting during the COVID-19 pandemic.4 Wear ugly sweaters. Cook the same meal for dinner. Pour your favorite beverages. Share laughs competing in a movie-themed holiday trivia.

Or, set a tentative date for next summer to organize a backyard barbecue, a party at the park or a local daytrip. When it’s safe for people to gather again, spending more time with friends and relatives may be a priceless alternative to spending dollars on tangible items that can really eat away at your wallet.  


Need ideas for the teachers, neighbors and colleagues in your life?

As they say, it’s the thought that counts.

Rather than hunt online for the perfect surprises, which can add up fast, use this opportunity to show off your hidden DIY talents. Bake batches of your famous chocolate chip cookies. Design booklets of your top-secret recipes. Craft decorative photo ornaments. Mix up jars of homemade hand soap.5,6 Knit cozy scarves. Prepare containers of your most delicious dish to provide a quick and easy supper.7

Whether you’re a master chef, writer or artist, you may be able to bring more comfort and joy at a fraction of the price.

Whether you're a master chef, writer or artist, you may be able to bring more comfort and joy at a fraction of the price.


In the wintertime, you can’t build a snowman without snow.

And, of course, you can’t build a holiday budget without establishing some ground rules for your household. In fact, there are six steps that you will want to consider when creating your holiday budget.

Before “you-know-who” comes to town, be sure to inform each person who lives under your roof, like your spouse or partner and children, that you intend to follow a very specific gifting strategy that may include:  

  • Something they want.
  • Something they need.
  • Something to wear.
  • Something to read.

Nothing less, nothing more.

To begin, allocate a unique amount for each person. Be exact and don’t waiver! Download a mobile budgeting application or maintain a savings document to track each transaction and monitor your progress.10 Then challenge yourself to stay disciplined and resist the urge the splurge.


Black Friday and Cyber Monday may be two of the biggest days on the retail calendar for sales, rewards and discounts.In fact, on these two days alone, the average American usually fronts a bill of more than $300.8,9

If you miss out on all the hoopla and the hysteria, though, there’s still a good chance you can score some great savings.

Search your email inbox for exclusive coupons and promotional codes. Only order from retailers that offer free shipping. If you’re in the market for brand-name electronics or appliances, see if you can find previous models in the clearance section. Even if you’re “naughty” and wait until the last minute to complete your shopping, take advantage of whatever penny-pinching bargains are available to you.

Save for future holidays with an Empower Investment Account

1 The Simple Dollar, “Americans Plan to Spend Less this Holiday Season,” October 2020.  

2 Coral Murphy, USA TODAY, “Holiday shopping 2020: 1 in 4 Americans already finished buying all their gifts,” October 2020.

3 FINRA, “How to Avoid the Holiday Debt Trap,” December 2018.

4 Anna Goldfarb, The New York Times, “How to Have a Successful Virtual Happy Hour,” May 2020.

5 Nicole Spector, NBC News, “The procrastinator's guide to cheap, thoughtful gifts you can DIY,” December 2019.

6 Amanda Garrity, Good Housekeeping, “75 DIY Christmas Gifts to Add Creativity and Heart to Your Holiday,” August 2020.

7 Amy Bergen, The Simple Dollar, “The True Cost Of Eating Out (And How To Save),” November 2020.

8 Rose Maura Lorrie, The New York Times, “Is It Worth Waiting for Cyber Monday Deals?,” November 2020.

9 Abha Bhattarai, The Washington Post, “Black Friday’s not dead yet: 70 percent of American adults shopped Thanksgiving weekend,” November 2017.

10 Julie Compton, NBC News, “How a 'spending to-do-list' can help you save big on holiday shopping,” November 2017.

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