SAN FRANCISCO (KRON) -- You've already done all the costume and candy shopping, so now it's time to focus on the next big spending holidays of the year.
Financial experts say if you start holiday shopping now, you'll be in a better place as the year comes to a close.
East Bay financial advisor Sam Gaeta with Defined Financial Planning says a recent study found companies will have to spend $223 billion dollars more for the cost of goods due to supply chain issues, postal service delays and staffing shortages.
And those costs could be passed on to consumers.
Everything from toys, books, bikes, new clothes and more have been subject to shortages, backorders and delays.
Even the American Christmas Tree Association is asking people to get their trees early because of weather concerns in the Pacific Northwest.
Big box retailers started offering Black Friday deals last week and even with the deals, Americans are expected to spend between 7% and 9% more than in 2020, totaling about $1.3 trillion. Online sales are expected to go up even more, with experts predicting an increase of between 11% and 15% this year compared to 2020.
So, how can we prepare our finances ahead of time this holiday season?
Start Early
- To avoid the anxiety of finding the perfect gift in a year filled with supply chain issues, you and your wallet will be better off if you start now.
- The earlier you start the less you will have to spend on expensive last-minute shipping costs, and the more likely you are to take advantage of early deals.
Have a Plan
- A successful shopping season starts with creating a spending plan, especially since sales are starting early and there could be less than most people are used to.
- Be as detailed as possible. Look at your budget to determine how much you can afford to spend this holiday season. Then list each person you need to buy gifts for and how much you want to spend on them.
- Don’t forget to budget for the extras, like shipping, wrapping paper and holiday decorations.
- Make sure you keep an eye on shipping deadlines so you don’t end up paying extra. I have a link on my website, definedplanning.com to help keep track.
Give a Gift that Lasts
- One idea is to contribute to your child’s or grandchild’s future education through a 529 plan.
- This money won’t be taxed as long as it’s used to pay for approved educational expenses, like tuition, fees, books, supplies and room and board.
- You could also set up a checking or savings account to start teaching your kids about finances.
- If you can’t afford gifts this year due, that’s okay. Handmade gifts and cards are always great and thoughtful!
Don’t Forget About You
- The presents are already wrapped and under the tree for your family and friends, but there’s probably someone you forgot: YOU!
- We’re not talking about a new TV or home gym. Instead, commit to your financial future by setting money aside to replenish your emergency fund or pay off debt.
- Debt is one of the biggest things holding people back from saving more and enjoying a worry-free retirement.
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