Holiday Spending: Be smart, be careful and be safe with these planning and protection tips

Published on November 17, 2021 | Webster Bank

These past two years have been like no other in history. And due to the widespread impact of the coronavirus pandemic, this upcoming holiday shopping season is shaping up to be different as well.

According to a recent Accenture Holiday Shopping Survey, “two in every five shoppers plan to spend less than they did last holiday [season].”

But, how can you avoid the pressure to overspend? Especially when more than 60 percent of shoppers plan to minimize in-store shopping and more heavily frequent online retailers where the tendency is to fill a shopping cart, pay for it with a credit card and schedule everything to be delivered right to the front doorÉ in just a few clicks? Your best strategy is to plan upfront.

Effective planning tips

1. Make a list of those you plan to buy for, noting at least one gift idea for each person on your list and where you might find it, at the best price. This can help you avoid the trap of making your decision while online (or in the store) when impulse buying may cost you more than you can really afford to spend.

   Even better, consider exchanging names among friends or family with a set dollar limit to purchase a gift for one person. Remember, itÕs quality, not quantity that matters when giving.

2. Set a limit on the numberÑand costÑof the gifts you plan to buy. This will help you stay within your budget and still allow you to purchase something for everyone on your list. Keep track of how much youÕre spending through mobile banking, and be aware of how much remains so you donÕt exceed the total amount you set for holiday shopping. To stretch your budget, look to discount sites and stores to buy “stocking stuffers” all in one visit, to, again, help you avoid impulse buys.

   Also, think about pooling your resources with other family members to buy gifts for individuals, particularly if it involves a rather expensive present.

3. Start early. This year, three out of 10 consumers say they will start shopping early for the holidays. By doing this, you can take advantage of “lowest” pricing promotions, usually offered early on in the season, like Black Friday or Cyber Monday. (Be aware, however, sometimes deeply discounted merchandise comes closer to the holidays.)
4. Pay with available funds, whenever possible. Use cash, check, debit card or mobile payment apps, like Zelle or Apple Pay, which let you transfer funds directly from your account to pay for items. While apps have daily limits around $1,000, WebsterÕs Premier Checking account allows debit card purchases up to $5,000. Choosing these modes over credit cards let you avoid high interest rates and the enticement to “pay later”, which can lead to a larger debt than you can afford.
5. Give a gift card… when in doubt. YouÕll avoid overspending because you are selecting a pre-determined amount that fits your budget and lets that special person select an item they really want at their favorite store.

“One in three consumers (33%) expect to give more digital gift cards during the 2020 holiday season compared to past years.”
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Important cyber protection tips

Finally, if youÕre among the 59 percent of consumers who are planning to do more than half their holiday shopping online this holiday season, take precautions to avoid becoming a victim of cybercrime.

Here are a few ways you can stay safe while shopping online:

• Make sure the antivirus software and operating system on your computer or mobile device is up to date to block online threats.
• Set secure passwords and be selective with the automatic log-in feature that can prefill your usernames and password.
• Always sign out of online shopping sites when you are done.
• Utilize any face or fingertip recognition features, if offered.
• Use secure browsers that can encrypt your information; look for a picture of a lock on the status bar.
• Clear your cache/browser history often.
• Stick with reputable, big-name retail shopping sites, since theyÕre most likely to have stringent data security in place.
• DonÕt click on links or attachments in emails from people or retailers you donÕt know.
• Use mobile payment services to pay online, which use authentication tokens that are worthless if stolen.

Bottom line: plan out your holiday shopping. YouÕll enjoy the experience and feel better about your finances when January rolls around.

General Disclosures

The opinions and views in this blog post are those of the authors, and are not intended to provide specific advice or recommendations for any individual. Please consult professional advisors with regard to your individual situation.