Amid predictions of over $1 trillion in holiday spending, experts urge Americans to create spending plans to avoid financial pitfalls.
CHARLOTTE, N.C. — With holiday shopping season underway, financial experts are urging Americans to create spending plans as projections show consumers will spend more than $1 trillion this year, with the average shopper expected to spend about $900.
Mark Henry, CEO of Alloy Wealth Management, said the high spending projections are concerning given the financial difficulties many families have faced.
“What we have to do is we have to have a spending plan,” Henry said during a television segment on financial planning. “Let’s put what we’re going to look for for that person. How much it’s going to cost. Get the children involved, have the whole family involved.”
Henry recommended that families determine their spending limit in advance and stick to it, even if that means reducing purchases or cutting people from gift lists.
For those who haven’t saved money throughout the year for holiday expenses, Henry suggested alternative approaches, including making homemade gifts or focusing on essentials like shoes and clothing that children need anyway.
“It’s OK to sit down with the family and say, let’s figure out something different,” Henry said. “We’re gonna have a different kind of Christmas.”
He strongly cautioned against “buy now, pay later” payment options, particularly for small items, warning that juggling multiple payment plans from different retailers can lead to missed payments that damage credit scores for years.
“You end up with 3 or 4 payments at different retail stores, and next thing you know you have the money to pay them, but you forgot and it ruins your credit for 7 years,” Henry said.
Henry also warned shoppers about promotional offers like “buy one, get one free” deals, noting they often result in spending more than planned.
“If you only allocated to buy 1, buy 1,” he said.
Financial experts recommend using cash for holiday purchases when possible, ideally from money set aside during the year specifically for holiday spending. The alternative, they warn, is starting 2026 in worse financial shape than 2025.
“When do we break this cycle?” Henry said. “This is the time right now.”