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Tips to Shop Smarter This Black Friday and Cyber Monday

Don’t take on unnecessary financial stress this holiday season. Here are a few tips to shop smarter.

Anna Ostanina / Getty Images

The pressure of the holidays can put a lot of stress on you to spend beyond your budget. But no one wants to start the new year with a financial hangover.

Although inflation has cooled since reaching record highs in 2022, it’s still higher than the Federal Reserve’s 2% target -- and prices are still high across the board. Many of us are still grappling with the financial strains of high interest rates, lingering debt and the return of student loan payments

Stretching beyond your means to take advantage of a few deals can hurt your finances. Nearly 7 in 10 shoppers are likely to overspend at some point this holiday season, according to a CNET Money survey. And as Black Friday and Cyber Monday deals flood our screens in the next week, now’s the time to create a plan so you don’t overspend, too.  

Here’s how you can spend smarter and avoid debt this holiday season. 

Make a budget

Roughly 27% of shoppers told CNET they were likely to overspend during fall holiday shopping events, such as Black Friday and Cyber Monday. To avoid falling under this category, create a budget to figure out how much you can afford and stick to it. 

Using Excel, Google Sheets or a budgeting app, divide your holiday shopping into categories and set an appropriate budget that won’t put your finances in a precarious position. For example, if you’re attending a potluck this holiday season, you could provide a homemade dish instead of picking up catering from a restaurant. “Food and beverage” are among the categories consumers expect to overspend on the most this holiday season, but making a shopping list ahead of time can help you stick to your budget. 

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Shop with cash

A 2021 MIT study found that parting with physical dollars at the register versus tapping your credit card elicits a higher degree of pain. Credit cards have an intangible “deal with it later” quality. But when you use cash, you only pay with what you have in your wallet, and that can improve your chances of sticking to a budget.

And while debit cards are technically similar to cash and can improve your chances of spending less, remember that they lack the purchase and theft protections credit cards typically offer.

Establish guidelines with friends and family

There’s often pressure to get the best gifts for your loved ones, and we sometimes feel we need to match what others spend. But if you don’t want to skip gifts entirely, one way to relieve the burden is to discuss setting a price limit or spending cap for gifts. 

For example, instead of buying a gift for every person at your holiday party, you could propose a white elephant or Secret Santa gift exchange. Both of these gift-giving games only require you to bring one gift. Combine that with a price limit, and you’ll end up spending a lot less this holiday season.

Read more: Expert Tips for Avoiding Gift Guilt This Holiday Season

Use credit wisely

Nearly one in five Americans in our holiday survey have more credit card debt going into this holiday season than they did last year, and of those planning to rely on credit cards, 21% say they’ll need to carry a balance. But turning to credit cards when the average credit card APR is over 20% can lead to debt. If you don’t have the cash to pay for your upcoming holiday shopping haul, your Black Friday deal just got more expensive. 

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Turning to credit or Buy Now, Pay Later service when you don’t have the cash upfront can hurt your finances without a payoff plan. But if you decide to finance a purchase with a credit card, consider using a 0% introductory APR card so you have time to pay off your purchase without accruing interest. 

If you plan to use a BNPL plan to buy your gifts this year, read the terms and conditions so you understand the repayment schedule and the consequences if you fall behind. Plans such as Affirm, Afterpay and Klarna have become increasingly popular because they offer an interest-free way to pay in multiple installments (typically four). But there are pitfalls, especially if you pay late. If you suspect you won’t be able to cover the cost of your gift on schedule, think twice about using a BNPL plan. 

Score savings with a cash-back app

An easy way to find deals this holiday season is through internet browser extensions that scour the web for coupons and online rewards. Cash-back apps are free tools that can help you earn rewards and discounts when you shop online or in person, depending on the app. When you make a purchase using a cash-back app, you’ll get money back. Some apps give you the savings upfront with coupon codes, while others pay you in rewards you can redeem as cash back or gift cards. 

Ibotta, for example, partners with thousands of retailers, including Walmart, BestBuy, Amazon, Home Depot, Uber and Kroger. You can earn cash back every time you shop at one of Ibotta’s affiliated retailers, on the app or in-store. Plus, you can earn a $10 welcome bonus after spending $30 on your first purchase. If you’re shopping in-store, you’ll need to link your store loyalty account with your Ibotta app or upload your receipt to the app to earn cash back. 

Start a sinking fund for next year

Savings rates are over 5% right now, so opening a high-yield savings account to stash away next year’s holiday fund can be worthwhile. 

While starting a sinking fund now won’t help you avoid debt this holiday season, slowly putting away money can give you a head start on next year. A sinking fund is basically a savings account, but you set aside money with a particular goal in mind. The advantage of a sinking fund is you don’t have to worry about mixing your funds with other savings funds, like your emergency fund. Sinking funds are perfect for nonessential expenses like vacations, home repairs or holiday gifts. 

You can use online tools to streamline the process of building a sinking fund. Ally’s high-yield savings account, for example, lets you organize your savings into personalized buckets. You can set up as many buckets as you’d like to help separate your different savings goals. This also helps you visualize what you’re saving for. 

Once you find the right place to build your sinking fund, establish a figure you’re comfortable contributing each month. For example, you might put away $100 a month until next December. Or, if you have a particular amount in mind, run the numbers and figure out how much you need to set aside each month to meet that goal.

Farnoosh Torabi is Editor-at-Large of CNET Money and host of the award-winning podcast So Money.
Liliana Hall is an editor for CNET Money covering banking, credit cards and mortgages. Previously, she wrote about personal credit for Bankrate and She is passionate about providing accessible content to enhance financial literacy. She graduated from the University of Texas at Austin with a bachelor's degree in journalism, and has worked in the newsrooms of KUT and the Austin Chronicle. When not working, she is probably paddle boarding, hopping on a flight or reading for her book club.