How to budget if you overspent on the holidays

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After Thanksgiving, there are only a few weeks to finish shopping for last-minute gifts, to go out with friends who are back in town, to celebrate the end of the year with coworkers or to attend as many family parties as you can squeeze in before you have to travel back home (or before you get sick of them). All these things - grab-bag gifts, those headphones your son wanted, a bottle of wine at each gathering, bar tabs, flights, train tickets - can throw your budget off track. Here's how to save extra this January to reduce financial stress.

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Look at how much you've spent so far

This could help you gauge what to spend going forth. Did you spend what you expected? Did you go over your set budget? Knowing where you're at when you start will allow you to determine how careful you have to be come January. After paying all your pre-determined bills and expenses like mortgage, phone bills, gas bills, groceries, transportation and tuition, the money you have left will be what you can save or spend in the next month.

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Set a limit

Setting a limit - and sticking to that limit - will keep you on the right path to saving. If you know you like to treat yourself to a weekly coffee or a monthly trip to the nail salon, make sure that's part of your budget and not something that will take you over the limit and into your savings account. If you find it difficult to stick to your self-set limit, call your credit card company and ask that they lower the spending limit on your card. Note that setting a lower limit might consequently lower your credit score, so it's best to try to stick to goals you have set for yourself rather than the bank doing it for you.

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Make lists

Making a list of your purchases allows you to visualize how much you're actually spending. We all know what it's like walking into a grocery store for the necessities and walking out with that box of fresh-baked cookies or the box of Cocoa Pebbles you were craving. Those extras add up and making a list is one of the main ways to cut your grocery bill. Carry your list to the store with you, and you might stick to what you actually need. The bright side? If your New Year's resolution involves a more healthful lifestyle, sticking to your list will keep you away from the sweets.

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Are there any gifts you can return?

Nearly 1.9 million packages are expected to be returned in 2020 on National Returns Day, which is Jan. 2 this year. While there is no way to return that ugly Christmas sweater your great-aunt knitted for you, you might be able to return, exchange or receive store credit for those clothes you ordered on Black Friday. Because of the high number of packages expected to be returned, stores are more likely to change their return policies around the holiday season. Be sure to read any gift receipts for details, or check the store's website for their return policies. Exchange unwanted gifts for something you really need. If you get store credit, save it for a time when you're in a pinch.

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Designate 'no spend' days

Making challenges for yourself is a great way to start a budget. When looking at the month ahead, set aside days when you won't spend any money on unnecessary goods. Groceries, necessary. Gas, necessary. A large caramel macchiato with extra whip, not necessary. The new hand-stitched NFL jersey in the store window on your way home from work, not necessary. Save the items you don't absolutely need for days when you're not bouncing back after holiday overspending.  

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Think about everything

Not just typical things like gas, food, electric bills or other homeowner bills. Everything. Your daily cold-pressed juice, having to buy lunch at work, an ACE wrap for your kid's sporting injury, replacing your shampoo. Expenses come up that you forgot to budget for or are unexpected. If you set aside money for those surprise purchases, they won't be a blow to the bank account.

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Use cash

You can watch cash disappear from your wallet much easier than the balance on your credit card. Using cash will show you how much you're spending and hold you accountable to saving more throughout each week. Some places to start paying with cash: grocery stores, gas stations, convenience stores and coffee shops (just make sure it's not a card-only shop before you go).

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Pick up a side gig

Starting your own small business or simply picking up a side job is a quick way to boost your income. Try something simple like using your hobby to sell hand-crafted goods, or sign up for a babysitting or dog-walking service if you have the extra time. Put the extra money directly into your savings account, or deposit it and start paying off your credit card.

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Shop sales

Come January, lots of stores advertise major sales. Avoid paying full price for things you need by stocking up on sale items. Don't go overboard and buy things that aren't necessities. Stick to the list you made and search around for the best deals you can find. Winter clothes, gym gear and bedding are among the best sale items to purchase at the start of the new year.

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Use coupons

Cutting coupons or saving them on mobile apps is a great habit to keep all year round, but is even more helpful when you're focused on saving as much money as possible after a period of overspending. Try finding coupons for every store you shop at. Look in newspapers, on store websites and for in-store flyers that offer discounts or deals on the brands you frequently purchase.

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Make price comparisons

Don't just purchase on the spot. If you see something you want to buy, take the time to check the price of the item at other stores. Even though it could just be a few extra dollars, those dollars add up when you shop around for multiple items. Comparing prices also gives you some time to think about whether this is a purchase you really need to make. You may talk yourself out of it.

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Use the 24-hour rule

Speaking of waiting to make a purchase, use the 24-hour rule to determine whether you really need something. One recent study estimated that impulse purchases cost people $5,400 per year. Instead of seeing a pair of shoes you have to have in a store window and then going in to buy them, make yourself wait until that time the next day. Ask yourself how many times you would actually wear those shoes, if at all. Are they new shoes that might go on sale next season? Are there more important things you have to spend money on that week, like household bills?

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Make homemade meals

According to the U.S. Department of Labor Statistics, in 2018, the average American household spent $3,459 on food outside the home. Eating healthy can be expensive, but so can eating out. If you find yourself buying lunch at work or picking up carry-out dinners on your way home from the office, make eating out part of your "no spend" goal. Instead of buying a sub sandwich, make one at home. Instead of ordering chicken parmesan for $20 at a restaurant, make it at home for about $3.

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Make your coffee or tea at home

Just like making your lunches and dinners at home, you can also make your own coffee or tea at home. A regular cup of coffee will cost you between $1 and $3 per day. Add that up five times per week. By the time you reach a month, that could be a small grocery bill's worth of coffee - and that doesn't include the $5 latte you might treat yourself to from time to time. A pound of coffee beans can range from $10 to $20 and can make 48 6-ounce cups of coffee. If you're a tea drinker, you can buy 100 tea bags for around $9 rather than paying around $3 per cup of your morning English Breakfast.

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Walk, bike or carpool when you can

If the weather is nice, try biking to work if it isn't too far. Going to pick up groceries a few blocks away? Opt to walk instead of driving. For kids' sporting events, school activities or work, ask friends about carpooling. Splitting gas is better than paying for it all on your own.

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Cancel or hold your gym membership

This doesn't mean you have to stop being active, and it doesn't mean you have to cancel it forever. But if the gym is somewhere you go sparingly, consider canceling the membership until you get your finances back in line with your goals. Depending on your contract, you might have to wait to cancel until your plan expires. Consider workouts you can do at home and renew your membership after you've paid off your holiday expenses.

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Buy generic

Oftentimes, buying a generic product rather than a brand-name product will save you a few extra dollars. This is particularly helpful at the grocery store or a drug store. For example, if you take a vitamin D supplement, you can buy a generic bottle of it for around $13, as opposed to spending $23 on a brand-name bottle of the same size.

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Delete your card number from auto-pay accounts

If you're a subscriber to many online accounts such as magazines, newspapers, streaming services or music services, you might want to consider cutting off your auto-pay. The more you subscribe to, the easier it is to forget about the payments that get automatically taken from your account every month. Save on those added costs by logging in and canceling your subscriptions for the time being.

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Keep an emergency fund

Setting aside money you will not touch unless there's an emergency is the safest way to budget for unexpected events. Emergencies are unplanned and can be costly if you aren't prepared. If you have to visit the emergency room for any reason, the bill could range from $150 to $3,000 if you don't have insurance. If you do have insurance, you will still have a copay. Remember that your pet could have an emergency too. An emergency veterinary bill could cost around $1,500.

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Save your coins

Pennies don't get you very far these days on their own, but don't underestimate them. Put all those loose coins from your car console and your overstuffed coin purse into a jar and watch your savings add up. Want to continue budgeting after you've paid off your holiday debts? Here are 15 easy ways to save your money. 

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