Americans say inflation will change the way they shop for the holidays

While there are still a few months to go before the 2022 holiday season kicks off, that hasn’t stopped some consumers from thinking about kicking off their holiday shopping. In addition to the usual stress associated with finding the perfect gifts for loved ones, a recent spike in the cost of everyday items has caused many potential shoppers to reconsider their holiday spending strategies and how much they can actually spend on gifts.

According to a recent survey conducted by Bankratetwo in five (40%) respondents said inflation will change the way they shop for the holidays this year.

Recent results from the US Bureau of Labor Statistics. Summary of the Consumer Price Index It also showed that the Household Food Index, which reflects how much you’ll pay for grocery items, had risen 13.5% over the past year. A spike in grocery store prices could also mean holiday dinner items are more expensive this year than they were last year. The price of clothing, often a popular choice for holiday gifts, has also risen 5.2% year over year.

With that in mind, it makes sense that 84% of Christmas shoppers respondents to the Bankrate survey said they would try to save money this year: 40% said they would buy fewer items, 21% said they would buy gifts from cheaper brands, and 41% said they would look for coupons, sales and other discounts. 17% of holiday shoppers said they would do more DIY gifts, while another 11% said they would give second-hand or used items. 17% of respondents said they would use credit card rewards to help offset costs, while 27% said they would start shopping earlier than in previous years.

Here, Select offers some quick tips that could help you save some money if you’re worried about stretching your budget for holiday shopping this year.

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Table of Contents

Create a sinking fund for Christmas shopping

With the holiday season just a few months away, it’s not too late to start scraping together some extra money to spend on your purchases. A sinking fund is an amount of money that you can set aside for a specific purpose, like paying for a vacation or, in this case, buying holiday gifts.

A sinking fund can help you avoid having to dip into your other savings accounts to pay for holiday-related expenses. Make your contribution goals feel attainable by choosing a smaller amount of money to transfer to your sinking fund each week. If, for example, you start setting aside $20 each week to buy Christmas gifts right now, by December you will have saved $240. Depending on how much shopping you need to do, $240 may seem like a drop in the ocean, but a little can still go a long way.

It’s a good idea to transfer any cash from holiday shopping into a high-yield savings account, since they tend to pay significantly higher amounts of interest; Of course, you won’t earn hundreds of dollars a month in interest, but you’ll still earn more than you would with a traditional savings account.

Marcus of Goldman Sachs offers a high-yield savings account with no monthly fees, no excessive transaction fees, and no overdraft fees. While there is no minimum deposit required to open the account, you will need a balance of at least $1 to start earning interest.

Marcus by Goldman Sachs High Yield Online Savings

Goldman Sachs Bank USA is a member of the FDIC.

  • Annual Percentage Yield (APY)

  • minimum balance

    None to open; $1 to earn interest

  • monthly fee

  • Max transactions

    Up to 6 free withdrawals or transfers per statement cycle *Withdrawal limit of 6/statement cycle does not apply during the coronavirus outbreak per Regulation D

  • Excessive Transaction Fee

  • overdraft fees

  • Do you offer current account?

  • Offer ATM card?

Select also rated SoFi Checking and Savings as the best high-yield savings account with a welcome bonus. Once you set up and start making direct deposits, you can earn between $50 and $300, depending on the amounts of direct deposits made within a 30-day period. That extra money could also be used to help cover the costs of this year’s holiday shopping.

SoFi checking and savings account

Information about Sofi Checking and Savings has been independently compiled by Select and has not been reviewed or provided by the issuer prior to publication.

  • Monthly Maintenance Fee

  • Minimum deposit to open

  • minimum balance

  • Annual Percentage Yield (APY)

    Members with direct deposit earn 1.80% APY. Members without direct deposit will earn 1.00% APY.

  • Free ATM network

    More than 55,000 fee-free ATMs within the Allpoint® network

  • ATM Fee Refund

  • overdraft fee

    Free overdraft coverage is available; however, SoFi requires $1,000 monthly direct deposit income to unlock it

  • mobile check deposit

advantage

  • No minimum deposit to open an account
  • 1.80% APY with direct deposit
  • 2-day advance paycheck automatically when you set up direct deposit
  • Automatically save your change with Roundups and set savings goals with Vaults
  • Earn up to 15% cash back at local establishments
  • No foreign transaction fees

Cons

  • No reimbursement for out-of-network ATM fees
  • Not a separate checking or savings account

Try the reward stack to earn the most cash back possible

Rewards stacking is when you combine multiple shopping rewards programs to maximize the discounts, points, and cash back you can receive on a single purchase. For example, if you were to buy a gift online using a credit card that allows you to earn cash while using a browser extension like Rakuten so you can earn cash there too.

There are many credit card and rewards shopping services that can help you earn as many rewards and rebates as possible. Rakuten it’s a popular option as it’s easy to use: just add it to your browser and click the “activate” button when you’re on an eligible website. There are hundreds of participating retailers, and from time to time the cash back percentage for different retailers can increase or even double, giving you the opportunity to earn even more cash back on items you were going to buy from everyone. modes.

Rakuten

Information about Rakuten has been independently compiled by Select and has not been reviewed or provided by the company prior to publication.

  • Cost

  • How to save

    Get cash back on eligible purchases, automatic coupons and price comparisons.

  • How to use it

    Shop Rakuten.com, the Rakuten app, or install the browser extension.

  • How to receive your savings

    Cash back is given every 3 months by check or PayPal payment.

When it comes to credit cards, the Citi® Dual Cash Card gives you 2% cash back: 1% on all eligible purchases and an additional 1% after you pay your credit card bill. The card has no annual fee and offers an introductory APR offer, giving you purchasing flexibility.

Alternatively, the Blue Cash Preferred® Card from American Express allows you to earn cash back on several categories, including 6% cash back on transit US supermarkets and 1% cash back on everything else. Please note that the refund can be redeemed as a statement credit.

Citi® Dual Cash Card

  • rewards

    2% Cash Back – 1% on all eligible purchases and an additional 1% after you pay your credit card bill

  • welcome bonus

    For a limited time, get $200 cash back after you spend $1,500 on purchases in the first 6 months of account opening.

  • Annual quota

  • Introductory APR

    0% for the first 18 months on balance transfers; N/A for purchases

  • ordinary APR

  • Balance Transfer Fee

    For balance transfers completed within 4 months of account opening, an initial balance transfer fee of 3% of each transfer ($5 minimum) applies; after that, a 5% balance transfer fee applies to each transfer ($5 minimum)

  • Foreign transaction fee

  • credit needed

Blue Cash Preferred® Card from American Express

On the secure site of American Express

  • rewards

    6% cash back at US grocery stores on purchases up to $6,000 per year (then 1%), 6% cash back on select US streaming subscriptions, 3% cash back on US gas stations, parking, tolls, trains, buses and more and 1% cash back on other purchases. Cash back is received in the form of reward dollars that can be redeemed as a statement credit.

  • welcome bonus

    Get a $350 statement credit after you spend $3,000 on purchases with your new card within the first 6 months.

  • Annual quota

  • Introductory APR

    0% for 12 months on purchases and balance transfers from the date the account is opened

  • ordinary APR

  • Balance Transfer Fee

    Either $5 or 3% of the amount of each transfer, whichever is greater.

  • Foreign transaction fee

  • credit needed

Don’t wait until the last minute

Planning your purchases ahead of time can help you get a solid estimate of how much money you’ll actually spend for the holidays. Doing this can also help you determine how much money you should have in your sinking fund so you can create a specific goal to work toward.

Plus, if you wait until the last minute to start shopping, you risk having to pay more for expedited shipping and getting stuck buying super expensive items just so you have a gift to give.

Start by jotting down a list of everyone you need to buy a gift for and a few possible ideas for each person, and don’t forget to include any holiday decorations or other items they might need. That way, you can start tracking prices early so you can hit the buy button when you know the product you want is on sale or there’s some other money-saving deal you can take advantage of.

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Editorial note: Any opinions, analyses, reviews, or recommendations expressed in this article are solely those of Select’s editorial staff and have not been reviewed, approved, or otherwise endorsed by any third party.