The best and worst ways to budget for the holidays

Presents. Parties. Travel.

The holidays can drain our energy, and our bank accounts even if we try our best to prevent it.

We checked in with some of Canada's top personal finance experts for their best budget tips, but also their biggest blunders, because even the smartest money-handlers know holiday pressure can lead to poor decisions.

Make the 2nd-hand economy your 1st economy

Kerry Taylor,known for her blog Squawkfoxand her endless supply of creative money-saving tips, says her top strategy to keep spending in check is to scourthe second-hand economy for gifts.

"With Kijiji and Facebook buy and sell groups there are endless listings of brand-new toys, booksand kids' gear waiting to be bought for up to 95 per centoff retail," says Taylor.

"The bonus is most of these items are brand-new, with tags still attached, so you're saving big bucks on the stuff selling in stores today."

She bought all her daughter's gifts this year for just $22.

Don't book the red-eye on Christmas Eve

Taylor loves to save money, but it doesn't always pay off as well as she hopes.

"I booked the red-eye on Christmas Eve to save a few bucks," says Taylor.

"The plan would have gone off without a hitch except a storm blew through Toronto that year and nearly grounded my flight. The worst part was the carrier overbooked the flight, so passengers were being bumped the night before Christmas."

She made it home in time to unwrap presents, but the stress and delay weren't worth it, she says.

The lesson learned?"If being home for the holidays is a big deal for you and your family, book your flight early and plan to travel on any night but Christmas Eve."

Figure out what the holidays are for

Bruce Sellery,author of The Moolala Guide to Rockin' Your RRSPand Moolala: Why smart people do dumb things with their money (and what you can do about it),has an answer for any financial question.

But his advice for the holiday comes in the form of a question.

"What's the purpose of the holidays?"asksSellery.

"It could be family time, religious connection, celebrating traditions, eating, eating, eating, relaxation, giving. Every family has a different answer and it is often a combination of these things."

Whatever it is, figure it out, Sellery says.

Then, put your time and money towardthat focused purpose. If holidays for your family are about spending time with each other, skip presents and do something together.

"That might seem simple," says Sellery, "but so many families behave in a way that is inconsistent with the purpose, leading to needless stress and spending."

Be OK with returning gifts

If you decide to give gifts, Sellery suggests it's financially smart to be open to returning or exchanging them.

"One year Dennis and I both got it wrong. I bought him a camera and he bought me a Fitbit. Neither of us were thrilled with the gifts, but we didn't say anything," saysSellery.

They both ended up hanging on to the pricey presents, when they could have enjoyed something else much more.

Sellery's selling a used Fitbit, in case anyone is interested in using Taylor's second-hand economy tip.

Save for holiday spendingone week at a time

Preet Banerjee, a personal finance guru who regularly shares his expertise on CBC's Bottom Line panel on The National,hasa strategy for shoppers to break free from their debt cycle.

"Every year, it's the same story," Banerjee says.

"People spend more than they planned, they pile it on their credit cards, and then we talk about the 'credit card hangover' in January."

Instead, he says, tally up the total amount you spendon the holidays this yearand divide that number by 48.

"Your answer is how much you should be putting away every week in an automated transfer to a new, dedicated savings account. Set it and forget it," Banerjee says.

Voila. Next year's budget.

How much are you spending this holiday?

8 years ago

Duration 0:56

Jacqueline Hansen looks at Accenture survey results showing how Canadians are spending on their holiday shopping.

Avoid last-minute shopping

Banerjee does his best to avoid last-minute shopping.

Not because of the stress, or the crowds, but because he doesn't want any of his questionable panic purchases to show up on Twitter.

"I live my life just trying to ensure I don't end up on Peter Mansbridge's live-tweeting of last minute Christmas shoppers on Christmas Eve," Banerjee says.

Don't pack your presents

And finally, a note to annual holiday travellerswho fly home every holiday season with a suitcase full of little gifts forthefamily.

Watch out for overweight luggage fees. As well, most airlines don't wantwrapped presents in your luggage.

The solution: order online and get the items shipped to where you're travelling. Just make sure you have someone trustworthy to receive the packages, who won't "accidentally" open them.

Your loved ones will also appreciate that you'vebeen able to pack more than one change of clothes.