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Four Smart Money Moves to Make This Holiday Season

money saving ideasReady for the end of the year? What’s that — you’re not?

In the midst of all the holiday parties, dinners, travel, gifts and other events that coincide with the Thanksgiving and holiday season, you shouldn’t forget about your finances, as well. Here are a few end-of-year finance and savings tips.

#1: Review your budget.

How many times have you heard people look at their credit card bill in January and exclaim: “How did I spend that much?”

You might not think you’ve dumped a ton of money into the holidays — after all, you bought modest presents for your family and didn’t fly anywhere exotic — but you’d be surprised at how quickly the “little things” add up. That bump in your grocery bill around Thanksgiving, plus that Uber ride home from the company holiday party, plus the new Christmas lights that you picked up at Target — before you know it, your holiday-related “unplanned” expenses have climbed into the hundreds.

My advice? Set a “holiday budget,” which I’m broadly defining as any expense that relates to this time of year, whether it’s for gifts, travel, clothes, or serving dinner to a party of 12 at your home. If you need some extra help in adhering to your budget, here are two ideas:

  • Withdraw this money in cash, put it into a physical envelope, and use this to spend on holiday expenses.
  • Move the money onto a prepaid debit card, and use only this card for holiday spending.

#2: Use your FSA.

If you’ve set up a Flexible Spending Account, or FSA, at your workplace, make sure you use the funds as quickly as possible. Most money inside of your FSA is “use-it-or-lose-it,” which means that money remaining in your FSA after December 31 will vanish. (For those of you who are unfamiliar with this type of account, an FSA is a tax-advantaged account that can be used to cover qualified medical expenses, such as doctor’s visits, eyeglasses and more.)

The U.S. Treasury Department and the IRS recently changed their guidelines to allow workers to “roll over” up to $500 of unused funds into future years, though not all employers have yet adopted this policy in their own internal company guidelines. Check with HR to see if you’re eligible for the $500 rollover, or if you need to whittle your FSA balance down to zero before the ball drops on New Year’s Eve.

One final quick comment — some very generous employers give their workers a “grace period,” in which they can use FSA funds until March 15 of the following year. Check with your employer to see if you’re fortunate enough to have this grace period — but still hurry to book your medical appointments, as slots fill quickly during the holiday season.

#3: Contribute to Your 529 Plan

Every state has its own rules and requirements around the 529 college-savings plan, a tax-advantaged plan that you can use to save for your children or grandchildren’s educational expenses. (Technically, the beneficiary doesn’t need to be related to you — you could open a 529 for a neighbor, friend, niece or nephew.) Some states will allow you to make contributions up to April 15 that can retroactively be applied towards the previous year’s limits. However, other states require you to make contributions by December 31. Check your state requirements and add money to any 529 accounts that you’re sponsoring.

#4: Give to Charity

Don’t forget: the holidays are a time of giving, and that includes making donations to charitable organizations. If you itemize your taxes, you can take a tax write-off for donations that you make to nonprofit organizations, regardless of whether you make a cash donation or whether you give “goods” such as furniture, clothing or canned goods. Just keep detailed records of everything that you give (including photos, if possible) and make sure you have a signed receipt from the organization that shows the value of the goods.

Kennedi writes about money and saving for Face & Fitness.

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My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.


  1. When I worked in corp America my biggest issue was never using up my FSA entirely. It was great my company adopted that policy you mentioned cause it help but eventually I figured out how to properly assess my medical needs that would be covered through FSA.

    • I once lost $200 by not using FSA funds by December 31.I’m glad the rules are changing.

  2. I always put a pitiful amount of money in my FSA because I was so afraid of not using it. We did get quarterly updates by email. That helped.

    • The most important thing is to get your appointments booked early — like by August or Sept. I’ve noticed that doctor appts tend to fill up quickly at the end of the year, probably from all the other people trying to spend their FSA money.

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