Financial experts share their best advice.

By Perri Ormont Blumberg
December 11, 2019
Woman paying for jewelry with contactless payment technology in a clothes store
Credit: Getty Images / Alistair Berg

There's no denying it: It's easy to blow through your budget as your gift shopping for loved ones during the holiday season. First off, know that you're not alone if you get a little spend-happy. In fact, according to a recent Credit Karma survey, more than a quarter of Americans expect to go into debt this holiday season. Thankfully, with some spending savvy from the pros, it's easy to stay on track during Christmastime—and beyond. Below, our favorite tips for avoiding credit card debt while holiday shopping.

1. Write out a plan for holiday gift spending.

"Write down all the gifts you want to buy this holiday season broken out by each person you want to buy them for. Then, allocate a certain amount to each person. Come back to it again in a day or so to review, and ask yourself if you can manage to buy everything on the list," suggests Dana Marineau, VP, and financial advocate at Credit Karma. "Can you instead find creative ways to gift something to certain people, like a handmade gift? Create your list and set a firm budget as early as possible to help you focus on who you’re shopping for and avoid overspending."

2. Pay with cash as often as you can.

Now that you've made your list and checked it twice and you're ready to shop, strive to reduce card use as much as possible. "Credit Karma found that nearly 40% of Americans are most likely to use credit cards to do their holiday shopping. To keep yourself from overspending, carry a set amount of cash you plan to spend based on your budget. Paying with cash instead of a credit card can sometimes make the purchase seem more immediate, or real, and may curb your impulse spending," says Marineau.

A great alternative to cash? A reloadable debit card, as Lauren Greutman, Flipp savings expert advises.  "When you use cash or a prepaid card, you make more of a psychological connection with your money. You are more apt to stick to your budget and not go into debt on Christmas presents because you’re either physically seeing your cash dwindle or you’re maxing out the limit you set for yourself on the prepaid card," Greutman notes.

3. Use store credit cards wisely.

Sometimes, these types of cards can be a boon for your financial health, but sometimes they can be a landmine.  "Store credit cards can be great for earning rewards and discounts on everyday purchases at your favorite stores, as long as you're able to pay the bill in full every month! For example, the Target store card gives 5% back on all purchases, and the Kohl’s card gives 35% off your first purchase. So using a store card for purchases that you can afford to pay off by the due date every month, can help you maximize the benefit without the high interest rates adding on to your debt," says WalletHub's retail analyst Jill Gonzalez.  One thing you'll want to be particularly wary of when it comes to store credit cards is deferred interest. "The caveat of store credit cards are the deferred interest clauses that [accompany some cards]. Retailers that sell bigger items, like TVs or furniture, tend to entice customers with 'special financing' offers this time of year. What they really mean is that you'll be charge interest retroactively on your purchase—meaning that if you have even $20 left to pay on your $800 TV after the introductory period ends, you'll be stuck paying interest on that entire $800 purchase. Avoid at all costs!"

4. Organize a gift swap so you don't have to buy gifts for each individual in a group.

"Don't feel the pressure of having to buy for everyone," says Greutman. "I have 10 nieces and nephews, so we often do exchanges where each kid picks a name and spends $15-$20 on that person. That way each individual can have a thoughtful gift and you don't go into debt by racking up credit card bills." The same concept applies for friends and co-workers. For some affordable gift inspiration, check out Christmas Gifts Under $10 (That Look Anything But Cheap).

5. Look for deals year-round.

"If you see something on sale in July that you can afford and know you can gift it to someone in December, go for it," advises Marineau. "You won’t have to compete with crowds and you may even be able to get it for a bargain if you purchase it during special sales events like Amazon Prime Day, which typically happens around the middle of the year." To that point, it's never too early to start saving for future holidays. "The longer you save, the less likely you’ll need to rely on credit cards or loans to get through the holidays," notes Marineau, who suggests you consider opening a high-yield savings account, like Credit Karma Savings that empowers you to earn interest on your savings.

WATCH: 4 Simple Ways to Save Money on Groceries

6. Unsubscribe from retailers' promotional emails.

"If you get a lot of emails from retailers about deals, just unsubscribe. Sales really just encourage spending, and don’t help you save unless you were already planning to buy the item," shares Brian Ford, financial wellbeing expert for SunTrust, now Truist. Not to mention, you'll have a more zen inbox without endless promotions and holiday sales emails coming your way.

7. Got credit card rewards? Use them for gifts.

"Don’t let your credit card rewards go to waste. If you have a rewards card, do some research into how you can redeem them in the form of gifts," says Marineau. With the money you'll save from this on your holiday shopping budget, you may even be able to afford a little extra special something for yourself.