Best Ways to Save Money for the Holidays

The holidays are meant to be joyful. However, the most “wonderful” time of the year is also the most expensive time of the year. Between travel, gifts, decorations, and gatherings, the expenses pile up fast. That’s why getting a head start on holiday savings today can make a big difference later. Keep reading while we explore how to start saving money for the holidays.

The True Cost of the Holidays

For many Americans, holiday spending is a major source of financial pressure. These recent findings echo that reality:

• Nearly two-thirds (65%) of Americans felt stressed about holiday spending in 2024, and 17% admitted that financial anxiety made the holidays less enjoyable.¹
• In 2024, consumers spent a record of $994.1 billion on holiday retail sales. This averages $902 per person.²
• 43% regretted overspending for the holidays.³
• 85% of consumers used credit or borrowing for holiday purchases last year—a clear sign of how common “buy-now-pay-later” spending options have become during the season.⁴
• About 36% of Americans took on holiday debt in a recently, averaging $1,181 each.³

These numbers demonstrate the importance of starting to prepare early. Most people don’t intend to overspend or take on debt, but the chaos of the holidays makes it easy.

Ways to Save Money for the Holidays

So, how do you avoid becoming a holiday spending statistic? Try these different strategies to help you save money:

1. Create a Holiday Budget

Start by listing your expected costs (ex: gifts, travel, meals, decorations, and special events). Don’t forget smaller costs like wrapping paper, postage, and tips for service workers. Once you have a total, divide it by the number of pay periods left until the holidays. This helps you determine how much money to set aside for each remaining paycheck, turning your savings target into a simple, manageable plan.

PRO TIP: Look back at last year’s bank or credit card statements to get a realistic sense of your past holiday spending.

2. Set Up a Dedicated Savings Account for Holidays

Having a separate bank account helps you stay organized. It also keeps your holiday savings tucked away, so you are less likely to spend the money early. Plus, watching your balance grow can be a great motivator as the holiday season approaches.

The best bank account for holiday savings is a money market account. It has competitive interest rates that help you earn more money while you save—because everyone likes having more money!

3. Schedule Automatic Transfers

Automating your savings is the easiest way to stick to a holiday savings plan. Once you have a dedicated bank account for holiday savings, you can set up recurring transfers from your checking account to savings account. By choosing amounts that fit your budget, this method takes the guesswork out of saving money and keeps you on track.

4. Utilize a Round-Up Savings Program

Another simple way to build your holiday budget is through a round-up savings feature like Saving Cents. These types of programs automatically round up your debit card purchases to the nearest $1 or $5 and transfer the spare change into your savings account.

For example, if you spend $49.25 on gas, the extra $0.75 is saved automatically. No budgeting, no behavior changes—just a simple way to save built into your daily spending. And soon enough, your spending leftovers turn into real holiday savings!

5. Budgeting Apps and Tools

Online financial tools are a game-changer for managing budgets and tracking financial goals. In fact, recent survey findings show that 80% of budgeting app users check their apps weekly.

So, why are these tools such a great resource for holiday savings? The best budgeting apps let you set and track savings goals, create spending limits, automatically categorize your transactions, and manage debt—all from one place.

PRO TIP: Try Academy Bank’s My Finance360, a free money management tool that keeps everything organized. In addition to creating savings goals, tracking expenses, and setting spending limits, My Finance360 lets you connect all your bank accounts—including external ones—for a full view of your finances. This makes saving money for the holidays much more manageable for everyone.

Smart Holiday Spending Strategies

When the shopping season arrives, stretch your money even further with smart spending habits:

• Start Buying Early: Avoid the rush (and price hikes) by starting early. That way, you can save money and take your time finding gifts that your loved ones actually like.
• Compare Prices Before Buying: Use price-tracking tools or browser extensions to make sure you are scoring the best deals.
• Use Rewards or Loyalty Points: Redeem cash-back rewards and loyalty points for gift cards, travel perks, or direct savings. This will help you save money on groceries, gifts, and travel costs.
• Set Spending Limits Per Person: When you have a structured budget and set clear boundaries for each person, you have better control of your holiday expenses.
• Stick to the Plan: Impulse buys are one of the quickest ways to derail your holiday spending budget, especially online. Keep your list nearby and remember your goals!

The Best Account for Holiday Savings: Money Market Account

When it comes to saving for short-term goals like the holidays, money market accounts are the perfect fit. They combine the stability of a traditional savings account with higher interest rates and more flexibility.

At Academy Bank, our Premier Money Market Account is designed to help you save smarter and faster. Here’s why it stands out:

• Competitive money market rates for higher earnings
• Easy access to your funds with online transfers, debit cards, check-writing, and more
• FDIC insurance coverage for added security and stability
• Digital banking tools to automate transfers and track progress on the go

The holiday season will be here before you know it. Choose Academy Bank as your holiday savings partner—your future self will thank you in December! Visit our bank online or stop by your local branch to explore financial solutions.

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