6 Unnecessary Holiday Spends According to Dave Ramsey

As magical as the holidays are, this time of year can be stressful—especially when it carries the weight of 2020. Holiday shopping adds up, but it doesn’t have to be quite so painful. There are ways we all wind up spending more than we need to, and they’re easy to avoid once recognized. Here are six sneaky spends that trusted budgeting expert Dave Ramsey advises saying “no” to.

Extended Warranties on Electronics

Be ready to hear this pitch as soon as you reach the register. According to Dave Ramsey, you should decline the extended warranty simply because it’s not a good deal.

“Warranties at electronic stores are ridiculous because these stores have slim margins on the products they sell. And since they have to make money somehow …hello, upselling of extended warranties. The markup is unreal! Stores can make a major profit (and commission) just from selling one to you,” says Ramsey.

Additionally, look at past behaviors: Have you cashed in on any electronics warranties recently? Did you forget that you purchased one? Did you attempt to use your warranty only to find out that water damage wasn’t covered? Did you need your warranty right after the 90-day expiration?

Store Credit Cards with Discounts

Buying gifts with a credit card is an easy way to spend more than you can afford—even with an enticing 20% off. Because you don’t see your balance decreasing in your checking account, it doesn’t feel real at the time. Out of sight, out of mind.

“Everyone from big-box retail stores to Uncle Bob’s Toothpick Shack seems to have their own store credit card these days,” says Dave Ramsey. “They’ll be more than happy to offer you 20% off a $7 purchase of Santa Claus socks, if you’ll just open a credit card account.”

Nobody should get into unnecessary debt every year just to participate in holiday traditions. Leaving the credit card at home forces you to stick to your budget. Using only cash (or a prepaid card) is better because even with debit, we can sneak a few extra purchases without noticing right away.

Equip yourself with the cash envelope system and holiday budgeting guide.

Overnight Shipping

Plan, plan, plan ahead. To avoid ridiculous shipping markups, avoid waiting until December 22nd to order your Christmas presents. If you order a few weeks earlier, you might even be able to get free shipping and have it arrive in plenty of time for Christmas.

Another smart tip: If a store has a minimum purchase to qualify for free shipping, try to buy multiple gifts for the people on your list from the same place in order to hit it. Mailing gifts yourself? Plan ahead so you don’t find yourself shelling out a lot of money at the post office to send them express which costs a lot more.

Gift Wrapping Services

If it’s complimentary at the store, have at it. But you really don’t need to pay for someone else to wrap all your gifts. You can save tons of money by buying a roll of wrapping paper and a bag of bows from the local dollar store. It’s all going to get ripped up on Christmas morning anyway.

You could also get crafty! Grab some newspaper, brown bags or butcher paper and wrap your gifts with it. You can dress them up with some festive twine and ribbon, or let the kids decorate them with stamps and markers to give to the grandparents. It’s affordable and adorable!

Holiday-themed Prepared Food

From decadent cookies to charcuterie plates, grocery stores know how to entice us this time of year. And since we’re in the spirit, treats that we normally wouldn’t even consider buying find their way into our shopping carts. Be mindful that a lot of brands use festive-looking designs on their packaging to sell mediocre food. Just because the box looks good doesn’t mean the chocolates are.

If you want to have some special treats without adding an extra hundred dollars to your grocery bill, the holidays are a wonderful time to do some home baking and to try out those recipes that you usually don’t have time for.

Everything on your Child’s List

Set a reasonable budget, determine what’s fair for each child, and stick to it. Be sure you’re following realistic gift guidelines before you go shopping. “Don’t let your kid’s list dictate how much money you spend—your budget should do that,” says Dave Ramsey.

Try this budgeting sheet and cash envelope system.

Dave Ramsey adds that there are many sneaky buys that can drain your budget. Some people end up spending just as much money on stocking stuffers as they do on gifts under the tree. Don’t get swept up needing to fill a stocking with expensive gifts. Set a minimum budget per child and keep it simple. Don’t break the bank on stocking stuffers when your local Dollar Store has everything you need.

Content in this post was adapted from this article on DaveRamsey.com.