How to Save Money on Christmas Spending This Holiday Season

When I think of Christmas, I think of sipping hot cider at my grandfather’s house, watching my little cousins play with their new toys, and spending time my dear ol’ dad. 

But when you’re struggling to get by or working toward bigger financial goals like paying off debt or saving for an emergency, all can think about is how to save money on Christmas this year.

It’s hard to stay on track with your goals with the temptation to spend all around.

According to a recent survey, 61% of people with credit card debt were willing to go further into debt for holiday spending.

But the good news is, debt isn’t the only option.

10 Ways to Save on Christmas This Year

You don’t have to spend a fortune to give your loved ones a special Christmas. Here are some ways to save money on Christmas shopping while still checking off everyone on your list.

1. Earn Cash Back for Your Online Purchases

If you’re determined to purchase Christmas gifts for your loved ones, you can absolutely do so without breaking the bank. Sign up for Rakuten (formerly Ebates) and earn cash back on all of your online purchases from major retailers.

Free Price Company makes commissions on your purchases.

DollarSprout Rating Easy cash back with browser extension.

Rakuten at a Glance:

Rakuten (formerly Ebates) is a free rewards website that gives users cash back on everyday purchases. Earn up to 40% back on sites like Amazon, Ray-Ban, Overstock, and Sephora. Install the browser extension to receive cash-back alerts when you shop on Rakuten’s partner sites. Every quarter, Rakuten will send your Big Fat Check through the mail or straight to your PayPal account.

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Pros

  • Easy and free to create an account
  • No personal or credit card information required
  • Rewards for purchases you already make
  • Browser extension for convenient alerts
  • Bonus for each friend you refer

Cons

  • Rewards sometimes slow to show up
  • Payouts are every quarter
  • Rewards voided if you return your items

If you shop at Walmart, Target, Amazon, Kohl’s and other popular stores, you can earn cash back for your purchases by clicking through to your favorite store on Rakuten. Plus, you get a $10 cash bonus for signing up and completing your first online shopping trip.

If you find the perfect Christmas gift for someone on your list, make sure to check for the same or similar items at other stores and calculate the percentage that Rakuten will refund in cash. You may find that one store is far cheaper than another when you factor in the cash-back amounts.

Related: 9 Best Cash Back Apps to Save On All Your Shopping

2. Purchase Discounted Gifts Cards to Your Favorite Stores

Any time you’re shopping online or in-store, make sure to check for a discounted gift card on Raise. Raise sells gift cards for less than they’re worth, some of which are more than 30% off.

If you’ve already signed up for Rakuten, search for Raise in your Rakuten portal, then click the link to Raise to purchase a discounted gift card. This will earn you 1% cash back from Rakuten. You’ll also receive $10 cash back for signing up for Rakuten if you’re a new customer and a $5 credit on Raise to purchase your first gift card.

Then locate a discounted gift card to your favorite store on Raise (from 0% to 30% off) and purchase it. Click from Rakuten to your favorite store to get even more cash back when you complete the final purchase online using your discounted gift card. For this example, we’ll use Kohl’s.

How to Save Money on Christmas with Rakuten and Raise

Let’s take a look at the math. Keep in mind that the discounted rates on gift cards, cash back percentages, and store promotions change all the time.

$100 – Total cost of Christmas gifts

Minus —

$10 – cash back for signing up for Rakuten
$6 – cash back for clicking through to Kohl’s from Rakuten
$5 – credit for signing up for Raise
$1 – cash back for clicking through to Raise from Rakuten
$3 – savings for using Raise to purchase a discounted Kohl’s gift card
$25 – additional Kohl’s holiday discount
$20 – additional Kohl’s cash holiday bonus (to grab just a few more cheap Christmas gifts!)

= $30 – total spent on your $100 online shopping trip at Kohl’s. The total savings/cash back earned on this shopping trip is $70!

So let’s go over the instructions on how to get cheap Christmas gifts with Rakuten and Raise one more time.

  1. Sign up for Rakuten.
  2. Open Rakuten in your browser or phone and find Kohl’s.
  3. Click on any Kohl’s link to open a Kohl’s shopping trip.*
  4. Sign up for Raise.
  5. Open Rakuten in your browser or phone again and type “Raise” in the search box.
  6. Click on any Raise link to open a Raise shopping trip.
  7. In Raise, search for Kohl’s.
  8. Purchase a discounted Kohl’s gift card from Raise.
  9. Return to your Kohl’s shopping trip previously opened via Rakuten and check out using your discounted gift card purchased from Raise.

*Note that you are actually shopping and paying through Kohl’s and not Rakuten. Rakuten is simply providing the special link that secures your cash back.

You can do this sequence of steps for any store (not just Kohl’s). There are many other options, and you can always stack these discounts and cash back amounts on top of the promotions currently offered by the retailer.

Related: Raise Review: Is It Safe to Buy Discounted Gift Cards?

how to save money on christmas

how to save money on christmas

3. Celebrate Christmas for 12 Days

Christmas gifts don’t have to be wrapped and placed under the Christmas tree. In fact, spending quality time together as a family, couple, or friends can be even more meaningful than presents.

If you plan free family gatherings, movie and game nights, and celebrate the magic of Christmas for multiple days, everyone will feel like Christmas is much more than just one day.

Spend time together as a family. Go Christmas caroling, drink hot cocoa, and tell Christmas stories. Christmas is far more than opening a few presents on one morning of the year.

Here are some other cheap or free activities to spread over 12 days of Christmas:

  • Make and decorate Christmas cookies together
  • Drive around neighboring towns and enjoy Christmas lights
  • Go window shopping at the mall
  • Make DIY crafts and gifts for family and friends
  • Decorate your house for Christmas
  • Read Christmas stories
  • Watch Christmas movies
  • Go Christmas caroling at the nursing home
  • Write letters to Santa or visit him at the mall
  • Have Christmas-themed family game night
  • Watch for other local free Christmas events in your area

4. Go for Practicality Over Price

If money is tight, then purchasing needed items for each person on your list will allow you to put something under the Christmas tree while still respecting the budget.

Unwrapping a new toothbrush, gloves, or slippers can be just as exciting as unwrapping a new toy. It’s the surprise element and the love behind the gifts that most children truly appreciate.

“Needs” that make great gifts:

  • Gloves
  • Slippers
  • Socks
  • Scarves
  • Clothing
  • Personal care items
  • Shoes
  • Fruit
  • Snacks
  • Educational books

Related: 40 Christmas Gift Ideas for Men

5. DIY the Gift Wrapping

Have you ever noticed how expensive wrapping paper and gift bags can be? Instead of purchasing new gift wrapping this year, try reusing gift bags from previous years.

Another option to really save on gift wrapping is to decorate newspapers with bright markers or paint to wrap gifts. Have the family help and make this one of your 12 days of Christmas activities!

If you’ve run out of time, you can even go with the black and white look of plain newspaper or use the comics section. Add a fun bow or ribbon if you have something around the house.

More ideas for gift wrapping substitutes:

  • Construction paper
  • Paper bags
  • Decorated scrap paper
  • Fun patterned scraps of fabric
  • Layered plastic tablecloths
  • Blankets or sheets
  • Unwrapped gifts placed in decorative baskets from thrifts stores

Related: 5 Cheery Ways to Celebrate Christmas on a Budget

6. Buy Gifts in Bulk

If you have a lot of people to buy presents for, try buying items in bulk to save some extra money on Christmas gifts.

Food or snacks are often a crowdpleaser when purchasing gifts for large groups of people. Whether you have a large family, a crowded office, or a lot of friends on your Christmas list this year, food items are very reasonably priced when purchased in bulk.

Ideas of items you can purchase in bulk to save money:

  • Food/snacks
  • Candy
  • Fun socks
  • Bath bombs
  • Soaps
  • Art supplies

Related: 40 Christmas Gift Ideas for Dad

7. DIY Your Gifts

family opening gifts next to christmas tree

It might be time to get creative. If you’re pressed for gifts but just can’t come up with the funds, a small DIY gift could be the answer.

Anything DIY can appear elaborate while not costing much. You can even have the kids make things for each other and for extended family and friends.

Here are a few DIY Christmas gifts to try:

  • Mason jar recipes (cookies, bread, trail mix, etc.)
  • Homemade candles
  • Home or office decorations
  • Knitted scarves
  • Fragrant soaps
  • Homemade snack boxes
  • Bath bombs
  • Movie night gift basket
  • Homemade board games
  • Handwritten or printed coupon book

Related: 40 Christmas Gift Ideas for Mom

8. Shop Around for Lower Prices

If you prefer to shop in store this Christmas season rather than online, that’s okay. You don’t need to shop online to get good deals.

Visit a few stores and compare prices. Saving $5 on gifts here and there really adds up when you have multiple people to shop for. You might find that the same toy is $40 at one store and $35 at another.

9. Shop Secondhand

When you think of thrift store items, you probably imagine broken toys, games with missing pieces, or clothes with holes in them. But many people donate new or slightly used items to thrift stores.

Browse your local secondhand shops and look for items that your loved ones would appreciate. If something is nice quality but doesn’t have a tag on it or shrink wrap around it, that doesn’t mean it’s a bad gift. Think of ways to wrap the item so it’s more presentable and fun.

Shopping for secondhand gifts is an amazing way to buy Christmas presents without spending exorbitant amounts of money.

Ideas for secondhand gifts:

  • Puzzles
  • Games
  • Books
  • Shoes
  • Clothes
  • Scarves & Gloves
  • Kitchenware
  • Home decor
  • Electronics

Related: 74 Creative Ways to Save Money

10. Be Honest with Your Loved Ones

If it comes down to purchasing gifts for extended family and friends or feeding your family, you need to draw a line. Skip Christmas gifts if they’re not in the budget this year.

If you’re able to purchase cheap gifts for your immediate family that double as “needs” this year, then that’s great. But simply tell your extended family, friends, and coworkers that you would prefer not to be included in gift exchanges this year.

Don’t let gifts put you into debt. Your loved ones will understand.

Cheap Doesn’t Mean You Don’t Care

Whatever season in life you may be going through, know that it’s okay to cut back on spending. Christmas will come and go this year as it always does and spending time with your loved ones is all you need to make it a wonderful holiday.

These ways to save on Christmas will help get you through the season. Do as much as you can for your family, but always remember that saving money on Christmas gifts can be done without making a dent in the joy that comes with the Christmas season.

Related: 40 Christmas Gift Ideas for Her

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