Monday, September 14, 2009

4 Tips To Save Money On Gift Giving

The festive period is a few months away which is a time when our household budgets are strained by all the gift buying and celebration. Since the recession started, my wife and I have started to plan our gift giving early in the year.

The process is similar to planning for a household budget. We indicate the amount to spend on gifts, for whom, as well as where this money is going to come from. There are no hard and fast rules - we adjust our gift giving in the event of upcoming weddings and anniversaries.

Buying gifts can cost a bomb. You need to plan properly in order to save money and not ruin our finances on excessive credit card expenses.

Here are some money saving tips to support your gift giving.

1. Redeem Rewards - If you have been swiping your credit cards throughout the year, it is a good idea to redeem your credit card rewards as a complement to your gift giving during the festive period. We have two credit cards that earn us cash back or rewards that can be used to redeem gifts.

There are also product rewards to redeem gift cards or other products. We have used the My Coke Rewards program to redeem points for special gifts. Look for these types of promotions on items that you frequently purchase.

2. Clearance Sales and Special Promotions - Flip open the newspapers and there are always advertisements of clearance sales. We do not stake out all the clearance sales but when there are attractive marked down prices, we head for the retail stores.

Some of the products we purchase include toys, board games, clothes, books, all of which come in handy during birthday parties for our kids.

3. Accumulate Extra Change - We keep our loose change in a jar and place them into our savings fund every month. It is somewhat like "extra money" which can be used to purchase gifts late in the year too.

4. Re-Gift - This means passing on a gift which you receive but you have little need for. Passing on gift cards is fine but some people don’t believe in re-gifting physical items, because it is disrespectful and unappreciative to the original giver.

There is a possibility that you may get fewer gifts if your friends and relatives know that such presents, which they spend money and time shopping for, are passed on to strangers. But if the gifts are lying around the house, they could end up in the dumps or being sent to the Salvation Army, come spring cleaning time.

I think it is too wasteful. Hence, to preserve the gift-giving spirit, I prefer re-gifting, than throwing stuff away.