6 Christmas Money-Saving Myths (And 6 True Ones)

The National Retail Federation estimates that the average American consumer will spend $902 this year on holiday gifts, decorations food and decor. That’s a new record and, for many consumers, an amount that’s simply not feasible.

While there are plenty of ways to save money this Christmas, there are just as many myths that could be costing you hundreds of dollars every year.

Consider This: 3 Things You Must Do When Your Savings Reach $50,000

Learn More: I’m a Bank Teller — 4 Reasons You Should Withdraw Your Savings Right Now

Here are some of the big ones, according to shopping experts.

Myth: Black Friday Deals Are the Best for Savings

Black Friday, Cyber Monday and other major weekend holiday deals are touted as the best way to save money, but that’s not always true. You might end up spending quite a bit more than you expect.

Truth: You Can Save By Shopping Sooner

“TD Bank’s 2024 Merry Money Survey found that more than half (55%) of respondents plan to make the bulk of their purchases on November’s Black Friday,” said John Bunzel, head of deposit growth and engagement at TD Bank. “But in fact, you don’t need to shop late in the year or on Black Friday weekend in order to save the most money holiday shopping.”

If you want to keep to your monthly budget, shopping early might actually be the better option.

“Shopping early can help you stick within your monthly budget rather than binge spending closer to the holiday with less time to finish buying gifts!” said Bunzel.

“In today’s day and age, Black Friday deals are also often extended before and after the shopping holiday, so consumers can shop early or even after and still stay on track.”

Read Next: 6 Things the Middle Class Should Sell To Build Their Savings

Myth: Cash Is Always Better Than Card

The idea here is that you can better control your spending if you use cash. Plus, credit cards tend to have high APRs — 22.8% on average — that can become more and more burdensome with every swipe.

Debit cards are better, since they don’t charge interest, but the ease and convenience can still lead to more spending than anticipated.

Truth: Cards Can Be Better for Savings and Earnings Opportunities

That said, cards have a lot of perks that cash simply doesn’t offer.

“TD’s Merry Money Survey also found that 42% of consumers prefer to holiday shop using debit cards and a total of 18% are using cash or check, likely so they’re able to pay off their spending immediately,” said Bunzel. “While paying in cash can have its perks, most cash users should consider switching to card payment methods for the protection and benefits they offer.”

Common perks include rewards, cash back and fraud and purchase protection.

“If you do choose to use a credit card this holiday season, it’s important to stick to your set budget and a payment plan you can adhere to,” Bunzel noted.

Myth: A Store Card Will Save You Money

Many major retailers offer store credit cards with the promise of saving money. At Macy’s, for example, you can save up to 25% on your purchases when you open an account that day.

Truth: Retail Cards Can Become More Expensive

While it’s true that you’ll get immediate savings by opening a store card and charging your purchase to your new account, many shoppers end up overspending or forgetting about high interest charges.

“You’re likely to get an initial discount, and that will look appealing, but these types of credit cards usually come with high interest rates,” said Tami Smith, co-founder at A Couple Consumers. “In the long run, it will wipe out any savings you initially had.”

Myth: You Need To Sacrifice To Save

Some people approach Christmastime with the idea that they should cut out the things they want so they have enough to give to the other people in their lives.

Being generous around the holidays is one thing, but cutting out the little pleasures in life can make this time of year a nightmare.

Truth: You Might End Up With Unrealistic Expectations or Guilt

While setting a Christmas shopping budget is important, you don’t want to overdo it and cut out all the fun for yourself during the holidays.

“Cutting out all fun and sacrificing buying things for yourself during the holidays aren’t necessarily the best ways to save money,” said Destiny Chatman, a spokesperson for TopCashback USA. “Depriving yourself of things that bring you joy to spend more on gifts is an unrealistic expectation and will result in feelings of guilt.

“The holidays are meant to be enjoyed and doing this will change how you perceive the holiday season.”

Set a realistic budget and, if needed, tailor the list of people you shop for so you can get them the things that matter the most. Be sure to leave a little room for your own saving and spending, as well.

Myth: Winter Is Too Late To Start Saving

If you’re shopping for Christmas, you might feel like it’s too late to start saving in the late fall or winter. But that’s not always the case.

Truth: It’s Never Too Late To Save

You can start saving at any point in the year.

“Though saving early is ideal, it’s never too late to start saving,” said Chatman. “Many caution against starting your Christmas fund in November or December, but even if your savings are small, it’s better than having no savings and having to fund all your Christmas shopping with one paycheck.”

Myth: You’ve Got To “Strike While the Iron’s Hot”

With “buy one, get one” (BOGO) deals and limited-time offers cropping up left and right, you might think you need to act fast on your Christmas shopping.

But this kind of mindset can quickly lead to going overbudget, missing out on even better savings opportunities and buyer’s remorse.

Truth: You Can Sometimes Save More by Waiting

“Impulse spending can actually wreck a budget fast, especially during peak shopping seasons,” said Trae Bodge, retail, smart shopping and money-saving expert at True Trae.

“Combat this by setting up a dedicated spending account through a debit card — such as the one PayPal offers with 5% cash back on up to $1,000 spent on categories you can select monthly — specifically for planned purchases, whether it’s for small stocking stuffers, gas for that long-awaited holiday road trip, or big-ticket items you’ve been eyeing.

“This can help you stay on budget and earn rewards every time you shop, with purchases big or small.”

More From GOBankingRates

This article originally appeared on GOBankingRates.com: 6 Christmas Money-Saving Myths (And 6 True Ones)

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

More Related Articles

Info icon

This data feed is not available at this time.

Data is currently not available

Sign up for the TradeTalks newsletter to receive your weekly dose of trading news, trends and education. Delivered Wednesdays.