Six Ways to Save On Your Holiday Spending This Season

It’s that time of year again, and with the holidays fast approaching, the coming weeks can be filled with a combination of excitement and stress for many Americans. After all, the desire to be generous can often be in direct conflict with one’s financial situation. Complicating matters for the 2023 holiday shopping season are rising interest rates and the resumption of student loan payments. 


So, what options do budget-conscious holiday consumers have if they don’t want to incur more debt? 

Woman using credit card to make holiday purchases

The information is provided for educational and informational purposes only. Such information or materials do not constitute and are not intended to provide legal, accounting, or tax advice and should not be relied on in that respect. We suggest that You consult an attorney, accountant, and/or financial advisor to answer any financial or legal questions. 

First, the facts…


Average interest rates on U.S. credit cards hover at about 21% for the most recently reported quarter, which ended in August, compared with about 16% in the year-ago period,according to the U.S. Federal Reserve Board. For retailer-issued cards, the average interest rate is nearly 30%, a record high, according to data from Bankrate. 


Given this economic climate, it only makes sense that there is a predicted pullback in holiday spending among a large chunk of consumers. Nearly a third of U.S. adults said they plan to spend less on the holidays this year, compared with 20% who said they plan to spend more, according to a September Morning Consult survey of about 2,200 people. 


Either way, shoppers who ring up purchases on credit cards will pay more interest if they carry balances from month to month after the Federal Reserve’s string of rate hikes. The cost of borrowing has climbed as credit card delinquencies — the number of people not making payments toward their balance — have risen slightly, though the metric remains below the highs of the Great Recession. In addition, student loan payments have resumed after more than three years of a pandemic-related pause, adding to the debt that many Americans are trying to pay off. 


While it might not feel like the season to be jolly, let’s explore a few ways you can avoid digging yourself deeper into debt while still keeping the holiday spirit alive… 


1. Calculate your debt


The first step toward avoiding holiday financial burnout is to know exactly where you currently stand with your debt. Our Debt Repayment Calculator is a simple, and free, tool that will show the total interest, total cost, and the total time it will take to completely payoff your debt.  


Once you’ve determined these details, we can move on to the next step: 

2. Create a budget (and stick to it)


Before you embark on your holiday shopping, set a clear and realistic budget. Calculate the total amount you can comfortably afford to spend without relying on credit. Consider all your holiday expenses, including gifts, decorations, travel, and special events.  


Once you have an estimate, use spreadsheets or budgeting apps to keep track of your spending. Allocate a specific amount to each category, such as gifts for family and friends, and adhere to these limits. When the budget is exhausted, resist the temptation to overspend. Having a well-defined budget ensures you won't end up with holiday debt that lingers into the new year. 


3. Use cash or debit


One surefire way to prevent holiday shopping debt is to avoid credit cards when making purchases in the first place. Instead, use cash or debit cards for your transactions. Set up a separate savings account specifically for holiday expenses and deposit your budgeted amount into this account.  


By using cash or debit cards, you're limited to spending only what you have available. This eliminates the risk of accumulating credit card debt with high-interest rates. If you prefer the convenience of credit cards, consider using a single card with a low credit limit and discipline yourself to pay off the balance in full each month. 

4. Start early and shop strategically


Regardless of using cash or credit, one of the most effective ways to prevent holiday debt is to start your shopping early. Don't wait until the last minute when retailers may increase prices, and the pressure to buy quickly can lead to impulsive decisions. Shopping ahead of time also allows you to take advantage of sales and discounts.  


Additionally, consider shopping strategically by using online price comparison apps, as well as tools such as PayPal Honey, which helps consumers find coupons, deals and promo codes. The money you save can go a long way in reducing your holiday expenses. 

5. Embrace thoughtful gift-giving


If you prefer to go low tech, the old adage still rings true: “It’s the thought that counts.” It’s important for us to remember that the holiday season is not about the price tag on your gifts but the sentiment behind them. Embrace thoughtful gift-giving by focusing on the meaning and personal connection of your presents rather than their cost.  


Consider handmade gifts, personalized items, or experiences like cooking a special meal or spending quality time with loved ones. You could also suggest a gift exchange with family and friends to limit the number of gifts you need to purchase, along with their price point.  

6. Consider installment plans


Some retailers offer layaway or installment payment options that can help you manage your holiday expenses without relying on credit cards. With layaway, you select your items, make a small down payment, and then pay for the purchase over time. Similarly, installment plans divide the cost of a purchase into several smaller payments. 


According to the PYMNTS Holiday Shopping 2023 Report, installment plans will take center stage during this year-end shopping season, with 41% of consumers ramping up their installment plan purchases compared to the rest of the year. Plans offered through general-purpose credit cards will see the most significant increase, with buy now, pay later and store-branded card plans close behind. Keep in mind that buy now, pay later plans can be done through companies like Klarna and Affirm – who break up payments into installments – but these services can come with fees.  


According to the same report, younger shoppers in the millennial and Gen Z age groups, in particular, will ramp up their use of installment plans. These options allow you to secure your holiday gifts early and spread the financial burden across several months. 



The holiday season should be a time of joy and celebration, not financial stress. By calculating your debt, creating a budget, starting your shopping early, embracing thoughtful gift-giving, using cash or debit cards, and considering layaway or installment plans, you can prevent accumulating more debt into the new year.  


And should your New Year’s resolution entail reducing the total amount of debt you owe by up to 51%*, click here to see if you qualify for the JG Wentworth Debt Resolution Program. We’re here to help consumers like you get back on track and reclaim their financial flexibility no matter what time of year it is.** 




* Clients who are able to stay with the program and get all their debt settled realize approximate savings of 51% before our 25% program fee. 

** Debt resolution program provided by JGW Debt Settlement, LLC (“JGW” of “Us”)). JGW offers this program in the following states: AL, AK, AZ, AR, CA, CO, FL, ID, IN, IA, KY, LA, MD, MA, MI, MS, MO, MT, NE, NM, NV, NY, NC, OK, PA, SD, TN, TX, UT, VA, DC, and WI. If a consumer residing in CT, GA, HI, IL, KS, ME, NH, NJ, OH, RI, SC and VT contacts Us we may connect them with a law firm that provides debt resolution services in their state. JGW is licensed/registered to provide debt resolution services in states where licensing/registration is required. 


Program length varies depending on individual situation. Programs are between 24 and 60 months in length. 


Debt resolution program results will vary by individual situation. As such, debt resolution services are not appropriate for everyone. Not all debts are eligible for enrollment. Not all individuals who enroll complete our program for various reasons, including their ability to save sufficient funds. Savings resulting from successful negotiations may result in tax consequences, please consult with a tax professional regarding these consequences. The use of the debt settlement services and the failure to make payments to creditors: (1) Will likely adversely affect your creditworthiness (credit rating/credit score) and make it harder to obtain credit; (2) May result in your being subject to collections or being sued by creditors or debt collectors; and (3) May increase the amount of money you owe due to the accrual of fees and interest by creditors or debt collectors. Failure to pay your monthly bills in a timely manner will result in increased balances and will harm your credit rating. Not all creditors will agree to reduce principal balance, and they may pursue collection, including lawsuits. JGW’s fees are calculated based on a percentage of the debt enrolled in the program. Read and understand the program agreement prior to enrollment. 


JG Wentworth does not pay or assume any debts or provide legal, financial, tax advice, or credit repair services. You should consult with independent professionals for such advice or services. Please consult with a bankruptcy attorney for information on bankruptcy.