Why You Should Start Your Holiday Shopping Early | The bank rate

There are exactly 100 days left until Christmas. Have you started your holiday shopping yet?

Bankrate’s recent survey found that 11% of winter holiday shoppers started shopping before the end of August. 14% planned to start this month and 25% in October. In other words, about a quarter of vacation buyers will start by the end of September and about half by the end of October.

Although it seems almost comical at first, I think there are benefits. And while these statistics are in line with previous years, consumer motivations seem to have changed.

How holiday shopping is different in 2022

Last year, the supply chain was so mixed due to the COVID-19 pandemic that it was necessary to start your holiday shopping early. Experts warned of empty store shelves and long waits and there was a palpable sense of urgency in the proceedings. It was also a seller’s market, with high demand and too little supply. This has given retailers more pricing power than usual.

This year, almost everything has changed. For starters, the supply chain has improved dramatically. Major retailers such as Walmart and Target complain that they have too much stock in certain categories and will therefore have to offer more discounts. This is great news for consumers, although not welcome for retailer profit margins.

This excess inventory has accumulated partly because items arrived out of cycle – for example, summer clothes that arrived too late – and also because some retailers over-ordered, not knowing exactly what would arrive and when. . Finally, there is the fact that demand has plummeted.

This particularly applies to physical goods, as diminished COVID-related fears have led people to spend more on services such as travel, restaurants and event tickets. Demand for many goods, such as furniture and electronics, has been brought forward in 2020 and 2021 as the pandemic has forced most people to spend more time at home. Now we see the other side of this phenomenon.

The elephant in the room these days is inflation, which has reached its fastest pace since the early 1980s. Our survey found that 40% of holiday shoppers are changing their behaviors due to inflation . The most common examples are seeking more aggressive discounts and purchasing fewer items. It makes sense: Americans spend so much more on housing, food, and gas that there is less money available for other things.

The benefits of starting your holiday shopping early

You might think I’m crazy writing about Christmas shopping in mid-September. I’m not saying you have to buy everything now, but I think it makes sense to get the ball rolling in the near future.

If nothing else, it’s a good idea to put money aside on every paycheck until the end of the year. Only about a third of holiday shoppers told us they had money set aside specifically for the holiday. I would like to see that number increase much more. After all, the holidays are no surprise.

Assuming you get paid twice a month, you probably have seven paydays left this year. Putting money aside for each of these will go a long way to avoiding the dreaded holiday debt hangover in January. This is especially important right now, since the average credit card APR is 18.10%, the highest since 1996.

In addition to saving money for the holidays, I also think it’s a good idea to start making a gift list. Who are you buying for? How much do you want to spend? Engaging in this type of planning exercise lets you know what’s coming and gives you time to make adjustments. After seeing this on paper (or on a screen), you might decide to narrow down your list of gift recipients. Or maybe you’re good at crafts or baking and can give a less expensive, but still thoughtful, homemade gift.

How to be a smart holiday shopper

Use the long lead time to your advantage. Advance planning is a luxury that can help smooth your cash flow and give you time to compare the best deals.

I’m a big fan of cumulative discounts. This involves combining multiple savings strategies on the same purchase, such as using a rewards credit card, online shopping portal, and store coupon.

As long as you can pay in full and avoid interest, paying with a credit card is a smart way to earn rewards and access other benefits like purchase protection and extended warranty coverage. Credit cards also offer much better protection against fraud than debit cards.

Finally, don’t forget to redeem any credit card rewards you’ve already earned. Whether it’s cash back, travel, gift cards or merchandise, there are many ways rewards points and miles can help offset your vacation expenses. And speaking of gift cards, if you’re one of the 47% of American adults who have unused gift cards, factor that into your vacation planning as well.

The bottom line

Holiday shopping can be a big expense, but with over three months to Christmas, you have time on your side. Use it well. Make a good gift list and double check it. Save money, compare the best deals, and take advantage of credit card rewards and gift cards – these are real money, even if they’re sometimes out of sight, out of mind.

Have a question about credit cards? Email me at ted.rossman@bankrate.com and I’d be happy to help.

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