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Nearly 3 in 10 Americans who used credit cards to pay for holiday gifts last year (28%) still haven’t paid off their balances, according to a .

, building up your savings and comparing prices are some strategies you can use to avoid spending more than you can afford.

Use earmarked funds

Putting money in a special savings account or envelope just for holiday expenses reduces the risk of going into . You’ll have funds ready when it comes time to shop.

“Ideally, people should begin saving for the holidays as early as January,” Los Angeles-based certified financial planner Cynthia Jabr said in an email interview. “If not, then starting now is good, too.”

Holiday spending falls under the “wants” category of the , which allocates 50% of your take-home pay to needs, 30% to wants and 20% to savings and debt repayment.

Setting aside $10, or any amount you choose, each week or day even for a short while can be a huge help.

Make a budget — and a list

Calculate a realistic holiday budget based on your monthly income, shopping fund (if you have one) and how much you expect to spend on other expenses during the holiday shopping period. Then, think about how many people you plan to shop for and set a per-person spending limit.

Make a list of specific gifts to get each person that fall within your limits. Remember to add your name to the list if you think you’ll buy something for yourself. <br><br>Keep track of your spending so you know where you stand. If you spend below your budget on one person, you can roll over the remaining money to someone else. For example, say you set a $50 limit for your nephew and find him a great gift that’s only $30. You could add an extra $20 to your budget for Grandma.

Go in on a group gift

If you feel like your budget won’t stretch very far, you might be considering taking on debt to pay for gifts.

According to the report from NerdWallet, 40% of holiday shoppers say they feel pressure to spend more money on holiday gifts than they’re comfortable spending. But splitting the cost with others could be a better solution.

Pooling resources with family or friends can ease the financial burden on everyone and ensure the recipient still gets a gift.

Resist the pressure to buy everything immediately

The fear of missing out on deals can lead to impulse buying. But as retailers begin to launch limited-time deals, remember that there will be more discounts ahead.

The main purpose of early sale campaigns such as Amazon’s Prime Big Deal Days is to get people to buy before the competition gets too intense, says Luc Wathieu, a professor of marketing at Georgetown University McDonough School of Business.

“What the companies are trying to do there is to shortcut the search, be there in front of you before you actually are in shopping mode,” he says.

Wathieu expects Black Friday and Cyber Monday will be the “sweet spots” for finding the best deals. Shoppers tend to be more active and price-conscious around this time, and retailers respond by offering competitive discounts.

Spreading purchases throughout the holiday shopping season can make costs more manageable. Pull up your shopping list before checking out sales and limit your search to those items. But if you wait until later in the season to shop, it’s a good idea to have a few backup items in mind.

“There might be more discounts as you get closer to Christmas, but the selection might not be as great as it is earlier in the season,” says Lauren Beitelspacher, a marketing professor at Babson College.

Understand your payment options

Paying with cash or debit is the best for avoiding holiday debt. With these payment methods, you pay in full with money you already have, which protects you from late fees and interest charges.

While credit cards and plans from companies such as Afterpay and Klarna conveniently break purchases down into smaller payments, they can also make it easy to spend more than you can afford.

“If using something like Afterpay is the best way for you to provide for your family, that's going to make you feel good about your family, then I think you could do that,” Beitelspacher says. "But still make sure that when the payment comes, that the money is there to make the payment.”

It’s also wise to avoid using several buy now, pay later plans at the same time. Losing track of how much you owe and when payments are due can lead to late fees and damaged credit. If you’re considering paying with a credit card or a buy now, pay later plan, make sure you fully understand the terms before you make the purchase.

Track down the best prices

Getting the items on your list at a discount can help you stay on or under budget. The prevalence of , especially with online shopping, can make it difficult to know whether you’re seeing the best price. Use technology to point you in the right direction. Apps and browser tools such as Capital One Shopping or ShopSavvy can help you locate coupons and compare prices across retailers.

As you craft your shopping list, knowing which products are more likely to go on sale can also help you .

“Try to buy things that others will want,” Wathieu says. “It's a little bit bizarre to think that way. But if companies predict that the demand will be hot on something, they also feel that other suppliers will fight for it, and so they will try to put their best foot forward.”

Wathieu and Beitelspacher expect some of the best deals in categories such as toys, games, electronics and kitchen items.

Review retailer return policies

Don’t let an attractive price persuade you to buy something you’re on the fence about. Do a little research first. You could be in a tough spot financially if you change your mind about the purchase later.

“The days of free returns and free shipping on returns are not as prevalent anymore,” Beitelspacher says.

She says that while a lot of retailers offered these incentives during the pandemic to stimulate sales and get through their excess inventory, many no longer do.

“If you're making that rash decision and you're telling yourself, �Oh, I'm just going to return it if I don't like it,’ just know that you might not be able to get your money back,” Beitelspacher says.

Before you buy something, investigate the retailer’s return policy, and note whether the item is marked as “final sale.”

Start saving up for next year’s purchases

Planning for the current holiday shopping season is key, but thinking long-term is smart, too. Making room in your monthly budget for next year’s holiday expenses now can keep you debt-free.

To figure out how much you should save, Jabr recommends looking at your previous year’s holiday spending, then asking yourself, “Was it too much, or just enough?”

Digging up online order confirmations and reviewing past credit card statements can help you estimate last year’s total.

If you’re comfortable with the amount you spent, and your financial situation hasn’t drastically changed, make that your target. Here’s what that could look like: If your holiday spending totaled $1,000 last year, aim to save about $83 a month for the next 12 months. Future you will be glad you did.