You can avoid overspending on the holidays. Here’s how.

0:28Can I tell you a funny Black Friday story? Like get in line at like 10 p.m. And so everyone's like in line and they're orderly. But the minute those doors open, it's crazy. Mad rush, right? So now there's no order. So my then 15-year-old brother goes up to the manager and says, you have violated the fire code. And if you don't give the people that were actually the first 20 in line these laptops, I'm calling the fire department. And they did it. And they did. They did it. Oh, I love your brother. He got his, he and my dad each got their$200 laptops. I love it. After staying up all night. Michelle Singletary is the personal finance columnist for the Washington Post.

1:12And any of her loyal readers can tell you that she has no patience for overspending around the holidays. And that includes on Black Friday, the day after Thanksgiving when stores lure in holiday shoppers, like my dad and brother, with sales and promotions. This season, Michelle says concerns about the rising costs of food, housing, and health care have consumers rethinking how much they spend. So I asked Michelle for some tips about how we can approach these holidays at a time when it seems like so many people are cash-strapped. From the newsroom of The Washington Post, this is Post Reports. I'm Kolbie Echowitz.

1:51It's Monday, November 24th. Today, financial advice from budget queen Michelle Singletary. We talk about everything from hosting a cost-effective holiday gathering to inexpensive yet meaningful gift ideas.

2:08Michelle, do you have any fun, like, Black Friday shopping stories? Oh my gosh. No. I don't like shopping. And so I don't like to be I don't like to shop when there are crowds. But I get it. You know, people are kind of excited about getting deals. I actually see sales as like a sneaky trick to get you to spend more. I feel like Black Friday has changed a lot because I remember when I was younger, like Black Friday, it did legitimately seem like, you know, Midnight strikes and you're going to get all of these great deals and people are lined up outside of Walmart or Target. But now I feel like Black Friday deals start on Labor Day.

2:55Do you have a point? No, 4th of July. Right? I mean, there's these same deals that you get on Black Friday. They're available to you all year long. That's exactly right. Is it the Internet? What's made the Black Friday experience change so much? Well, I think a lot of it had to do with the pandemic. So more people started shopping online. I think the online shopping has given us the ability to shop more. You don't have to leave your house to buy something. And so Black Friday sort of has lost its luster, right? Because you can get the deals anytime during the year, just one click and you have it.

3:30Is shopping on Black Friday, like, are you getting a deal? Like, is it smart if you're being a savvy shopper to, like, search for those deals around this time of year? I would say that you have to search smartly. Like my producer, I love Sharla. Hey, Sharla. We all love Sharla. So she turned me on to this. So there are apps that help you track prices. Don't listen to them. Oh, it's 50 % off. It's all 70 % off because it's been 70 % off the whole year. Right, right. So you're not really getting a deal. So if you know that there's certain things that you want to get, look at the history of how that was priced.

4:05So then you will have information to know whether or not it's a good deal. And you can go back and see what something cost, you know, several months ago. And then if they say it's 50 % off, but it's really pretty much the same price, then you know that's not really a deal. You might still go ahead and get it, but you're not driven by the sale. So do you have any strategies for how people should go about, like, tackling their shopping lists for the holidays? I mean, gift giving is one of the major love languages. And this time of year is all about the thrill of giving gifts to the people that you love.

4:44And it's also about the thrill of the deal. Yeah, it is. It is. I love that you use that phrase, love language, because it's not my language. No surprise, right? But it is my son's. And my son is on the autism spectrum. And he's so kind. And he just, he wants to please. And so around the holidays, he'll get a little notebook and he'll start quizzing me. Mom, what's your favorite color? What game did you like when you were growing up? And so I would discourage him. And I discouraged him so much so that one time he kind of left with his head tucked down. And I was like, okay, Michelle, he wants to give you something.

5:26So why don't you give him some ideas for some things? And I say that to say that even though when people hear me, he's like, oh, she's just going to tell us how to spend. I recognize that for some people, that is their love language. And I have to respect that. And so now I do give my son a list. I give him some ideas of some things I want. And I encourage him to go ahead and get me something, even though it's not my love language. You want to give. You're a pleaser. But have a plan so that instead of writing a whole list of everybody you have to give to, start with how much can you afford to spend.

6:04Say$300,$500, whatever it is. Set that amount and then fit the list into that amount. Don't do it the reverse way. List, then how much you're going to spend on each person. Start with the amount of money. Start with the amount of money. And then you want to get an index card. And at the top, say it's$300, and you've got your list of people. And you put them on there. And then as you're buying something, subtract from that$300. So you're constantly keeping track of how much you have. And then if you're really challenged, take your credit card bill that you can't pay off every month. To remind you.

6:38To remind you and pull it out and go, yeah, this is why I can't spend a whole bunch of money. And here's a tip. Take the friend who hates shopping. Don't take me then. Right. Don't take me. So people won't take me. So take the person who is always through goal. That is your accountability partner. And that is your conscious, right? You're a person who's going to go, why are you buying it? You know, I think this time of year is always stressful. But right now in this moment when prices are higher, when people feel like things are out of reach, do you feel like the stress level is even higher this holiday season than maybe in years past?

7:18Yeah, I do. I do. And even if someone feels secure, we all know that none of our jobs are secure. Right. Right. And unfortunately, what happened with the federal workforce where we always thought, I don't know about all the people listening, but when I was growing up, federal job was like, you know, if you did your job, you're going to hold on to a job. And that kind of made people realize that your job is not 100 percent. Look at tech, right? It used to be, oh, get a job and take it. You always have a job. That's not true anymore. And so I think a lot of people are worried, rightfully so. Right.

7:53I don't want you to be fearful, but I do want you to realize that none of us are secure. And knowing that you have to spend and give appropriately. Right. I think it's OK to feel what you feel, but don't let that drive you to the point where like if you can give, then give, especially to charitable groups this time of year. Michelle, what would you say to, like, a family with kids? And let's say they're a family that can't pay off their credit card bill every month. They're in debt. But Christmas is coming. Hanukkah is coming. And they want to give their kids a special holiday. I believe in managing people's expectations, even children.

8:36I don't come from any. I remember sparse holidays where my grandmother couldn't give us a whole lot. I remember that one holiday, she'd have a bowl of fruit and nuts in the middle of the table. And we each had our own space around the tree. To make the pile a little bit bigger, she would take the fruit from the bowl and add it to your pile so you felt like you had more. The best present you can give your children if you are struggling financially is not to increase that anxiety by giving them things that you can't afford. It's a hard thing. I get that. Another strategy is why don't you wait and open up the presents when you're visiting your family?

9:17So like if you're going to have a holiday dinner, you say, hey, listen, let's wait and open up the presents when we get to grandma's house. So grandma's going to have something. Auntie might have something. And then your gifts. And then they don't feel so deprived. So you sort of kind of do ways to make them feel as if they're not getting less. But you do have to be the grown up and just say we can't. And the older children, they already know. They're at the house. They see you're stressed. And don't underestimate the ability of your children to understand the situation. You don't want to burden them.

9:50You don't want to say, we broke. But you want to just say, hey, listen, you know we're struggling a little bit. I can't give you everything you want. But what I can give you, I'll try. But the most important thing is that I love you and that I want to create a safe home for you. I want to keep the roof over your head. And when I can do better and I get more, I will. I remember growing up, we didn't have a lot either. And my mom always used the layaway system at Kmart. She would start, every time we would go to Kmart, she'd give a little money so that, you know, by the time the holidays rolled around, there'd be enough there to buy me and my brother toys.

10:27So do programs like that still exist? Is that something that people should be thinking about when they're thinking about the holidays? I remember layaway programs very well. My grandmother did that as well. In that case, you'd get the item, but you couldn't take it home. You'd have to leave it at the store until you paid it off. And that was her way to get enough gifts to put in our little piles, right? And so now it's like, buy now, take it home, and pay us later. And I think it's a trap for many people because it encourages them to overspend, because they can stretch it out in a couple of payments.

11:01Oh, so stores are now letting you actually take the product home with you and pay it off in installments. Correct. Correct. Buy now. Pay us later. And if you have to use for the holidays, if you have to use that, I would say you probably can't afford the gifts that you're getting. And so be very careful about that. Now, if you've got the money and you've got maybe a bonus check, you know it's coming, but you want to grab an item now, I can see in some instances where it would be okay for you to get that. But I'm seeing increasingly, particularly among young adults, that they're piling up these buy now, pay later debts because it's debt.

11:40Please recognize that it is debt. Even though you may not be paying interest on it like you do for a credit card, it is debt. And then be very careful about signing up for store credit cards. So they come in, it's like, oh, you can get 10 % off on top of the 50 % you're getting off. Well, really, you're just getting into more debt. And those credit cards come with a higher interest rate. And then every time you sign up for a card, it can ding your credit score. So you want to be careful about that, particularly if you've got other cards that you definitely are not paying off the balance. Do you recommend that people start budgeting for the holidays all year long?

12:18I mean, I keep bringing up my parents, but I remember my mom had these envelopes that she kept in like a porcelain. It was like a porcelain bowl that like sat in our dining room. Anyway, one said vacation, one said holidays, one said birthdays. And I think when they got their paychecks, maybe they put$5 in it. But to budget for these things, as opposed to just putting all your money together in a savings account or something or spending it right away. Is that something you would recommend? I love it. It's called the envelope system. Okay. And for a lot of people, that works, right? It's a way for them to eyeball what they have.

12:52It's very effective for people because it makes sure they live within their means. So I love that. My grandmother used the envelope system. Same thing. And she wouldn't even buy a new envelope. She would just use the junk mail envelopes and write on there, you know, whatever she was trying to save for. So I love any strategy that will help keep you within your budget. And when it comes time to spend it, it's all there right in cash. Right. And I can spend it.

13:22We're going to take a quick pause, and when we're back, Michelle shares some tips for how to approach hosting this holiday season if you don't want to break the bank. We'll be right back.

13:43Good journalism is even better when it's shared. With a premium subscription to The Washington Post, you get three extra accounts to share with friends and family, so they can stay informed too. Right now, you can get a premium subscription to The Post for$6 every four weeks. Just$6 unlocks trusted reporting to share with other people in your life. After your first six months, it'll cost$19 every four weeks. You can cancel anytime. Head over to WashingtonPost.com slash subscribe and get premium access to The Washington Post today. That's WashingtonPost.com slash subscribe.

14:22I want to ask you about Thanksgiving because you had a column recently and the headline was, quote, I'm on a budget, but I want to host Thanksgiving dinner. Can I charge guests? First of all, I don't know. Is that like an actual thing that people do? It's an actual thing. That people charge people to come to their Thanksgiving. I mean, well, I mean, okay, let me, I want to hear your answer. But I think I could understand, like, can you split the groceries with me? Yeah. But like a cover charge seems a little weird. Basically, they're saying, I'm going to be host. I'm going to cook dinner, but I need you to bring money so that I can host.

15:00So they'll say, okay, we're having, you know, can you give me$25? Or everybody pay me$25. But it really is a charge, right? I mean, it's almost like they're at a restaurant. I think it's rude. I think it's not right. If you can't afford to host, don't host. You know, I mean, we should not, guests should not pay. It's as simple as that. Now, I know like a lot of young people like, you don't know what you're talking about. You know, okay, boomer, right? But you're the host. You're inviting me into your space. And I shouldn't have to pay you to be in that space. And if that means, okay, you can't afford the whole meal, I get that.

15:42Let's have a potluck. Well, I was going to say, I feel like a solution to that might be, I'll supply the turkey. Can everyone else bring the sides? That's right. Or something. Yeah, I love that. And my family and I do that. Now, to be a successful Thanksgiving potluck, you have to have a plan. You know, that's the theme for this, right? A plan, plan, plan. And so, okay, I'm bringing the turkey. You bring this. And listen, do not bring four rolls and you know there are 12 people coming. Do not bring the potato salad and you know you can make potato salad. Right. So you tell everybody, even to the point of if somebody doesn't cook, I don't cook.

16:21So then you handle the silverware and stuff or the cups and the ice or the drinks. And it is the most fun. Everybody kind of shares the financial burden. Yeah, I was going to ask you, how do you talk about that with your friends and family? Like, how do you talk about scaling back holiday celebrations and gifts this year? Because I imagine those are really difficult conversations for people. It is. It is. We have such a difficult time talking about money. Now, I was very surprised about this because we go online. We're talking about our sex life. We're talking about all kinds of stuff. We put our business out there.

16:54But when it comes to money, it's like silence. And so I am big on empowering people to live the financial truth. And so ahead of the holidays, you start calling people. You know, listen, I just need to get my money thing together. You don't have to give them any details. And I'm telling you, about 99.9 % of the time, you mention budget and trying to get my money together. And most people will instantly go, yeah, I know what you're talking about. And then you actually probably free them up because they're scared to talk about it. But once you bring it up, I know my budget too. My emergency fund isn't where it should be.

17:31And it just releases everybody from this responsibility of spending money on each other. And for many people, not all, because there's some people who are struggling and they don't have a lot. But there are a lot of people who, what more do we need? Your husband don't need another tie. No, I know. I don't need another scarf or bath set or lotion set. We are such a consumerist society, though. Like, we just love stuff, right? And we love accumulating stuff. and I feel like that's where you will come in and say, but you don't need it. You don't need it. You don't need it. And listen, one year my husband and I did a$100 holiday.

18:10It's actually a book called$100 Holiday by Bill McGibbin. And he said, just spent$100 on everybody. Like? Everybody. Fully, like only$100. Only$100. Okay. And it was the best Christmas we ever had. Everybody in our family, except for one relative, was so relieved because we said, we're not going to spend a lot. And you don't have to spend any less. And it was the best Christmas. Now, there was a relative. I'm not going to lie. He didn't speak to us till Easter. Really? Because there wasn't enough gifts for him? That's exactly right. But it was our fault because we didn't manage people's expectations.

18:49We kind of sprung it on them. Now, most people were cool with it, but we should have said ahead of time, like maybe Labor Day. Yeah, well, like you were saying, have those conversations. Let people know what to expect and not to expect from you this holiday season. There's alternatives, I guess, to having to buy everyone on your list a gift. Do you have any other tips for being able to give but not overspend? Yeah. You know, we joke about sort of the handwritten coupon for things, but it really is an effective way to give and not overspend or spend at all. And I was a mom of three kids. You know how hard it was to find a babysitter for three kids.

19:36And if someone said, instead of buying you, you know, some sweater in some color that I don't like, I will take your kids one Saturday night. So you don't even have to go out. You can just go upstairs and take a bath. I would have been like, yay. So things like that. Or you've got a working mom and she like works downtown and she's, and this was me, stretching, you know, just to try to pick up my kid. for a gift that you said, listen, how about, you know, once a month, I'm going to go get your kids so that you're not stressing trying to fight commuter traffic. I love that. Oh, my goodness. I'm going to be like, that's the best gift ever.

20:12And one of my daughters is such a great chef. She is such a great cook. She gave me a certificate for three home-cooked meals, and I can invite a guest. Ooh. And she actually put an expiration on it. and she would buy all the ingredients and cook. And I'm telling you, it's like the best gift. And at Thanksgiving, we also do Secret Santa. So that was the other thing, large family, lots of presents. That was getting crazy. And so now we do Secret Santa, meaning everybody picks a name, right? And you only buy for that person. You only have to get one gift. And please, please remember that the thing that we treasure the most is time.

20:55And that's something you can't buy, right? We don't have enough time for our friends. We're ripping and running and on our phones. But how about you come over and we have some tea and we just talk? I love that. That's so precious, right? And even our kids, we talked a lot about kids and wanting stuff. They're going to remember the times that you might have just, you know, walked around the neighborhood and picked up pine cones. or maybe you go see the Christmas tree in the community square or park or whatever. Those are the things, and I know this sounds so cryptic, but I'm going to say it anyway, that when you pass away, that's what they're going to say.

21:34Those are the stories they're going to tell. Hearing you say that, my dad passed away two years ago. And you're right. I don't remember a single thing that they gave me for my birthday or for the holidays when I was a kid. But boy, do I remember, you know, drives with my dad to go get donuts in the morning or, you know, when he would be able to give me time in an otherwise really busy work week. Like that's what I treasure and that's what I miss. So I think that's such wonderful advice. Michelle, thank you so much for coming on. And I hope you have a very, very happy Thanksgiving. Thank you.

22:15Michelle Singletary is The Post's personal finance columnist. That's it for Post Reports. Thanks for listening. Today's show was produced by Sharla Freeland. It was mixed by Sean Carter and edited by Rena Flores and Ted Muldoon. Thanks to Helen Fessenton. I know we just spoke about not giving in to Black Friday deals, but there's one that we'd love for you to consider. And that is supporting the reporting that we do here at The Washington Post. For a limited time, you can access the post for just 99 cents. That's unlimited access to all of the Post for only 99 cents every four weeks. That's a great deal for the first year.

22:53And after that, it'll cost$12 every four weeks. You can cancel any time. Go to WashingtonPost.com slash subscribe and grab this deal before it's gone. That's WashingtonPost.com slash subscribe. And don't worry, Michelle Singletary would approve. I'm Colby Echowitz. We'll be back tomorrow with more stories from The Washington Post.

23:25Good journalism is even better when it's shared. With a premium subscription to The Washington Post, you get three extra accounts to share with friends and family, so they can stay informed too. Right now, you can get a premium subscription to The Post for$6 every four weeks. Just$6 unlocks trusted reporting to share with other people in your life. After your first six months, it'll cost$19 every four weeks. You can cancel anytime. Head over to WashingtonPost.com slash subscribe and get premium access to The Washington Post today. That's WashingtonPost.com slash subscribe.