If you’ve ever hosted Thanksgiving dinner, you likely know how easy it is for costs to spiral. Between appetizers, drinks, the turkey, sides and pies, you can easily rack up (multiple!) large tabs at the grocery store. Even if you’re just traveling to have Thanksgiving with family or friends, you can end up putting a big dent in your spending account. Airlines and hotels often charge a premium during high-demand times like Thanksgiving weekend.
To avoid overspending just a few weeks before the gift-giving season, read on. We’ve got 31 ways to keep your Thanksgiving costs under control.
Related: Creating a one-year savings plan
Thanksgiving on a Budget: How to Save
Here are some simple strategies for doing Thanksgiving inexpensively this year. Bonus: They can also help you save time — and stress.
1. Stocking Up as Stuff Goes on Sale
Throughout November, stores typically have different Thanksgiving dinner items on sale. Grabbing nonperishables whenever you see them on discount can save a bundle, and also help spread out the cost of the meal.
2. Making It a Potluck
Whether you’re celebrating with family or friends, you can make Thanksgiving inexpensive by asking your guests to each contribute a dish. You can coordinate who is bringing what in advance to make sure there are no overlaps or gaps.
3. Checking Coupon Sites
Before heading out to the grocery store, you may want to check out coupon websites like Coupons.com, LOZO and CouponMom to find deals on the items on your shopping list.
4. Going to Manufacturers’ Websites
A few major brands likely produce many of the items on your Thanksgiving shopping list. It can be worth checking websites like Butterball and General Mills for coupons and seasonal promos.
5. Getting Your Grocery Store’s App
Many supermarkets have apps that offer coupons and deals. Sometimes, you can get a reward just for signing up.
6. Hitting More Than One Store
Going to just one supermarket is obviously more convenient. But if you check the circulars, you may see different items on sale at different stores. Going to a few different grocery stores could lead to significant savings.
7. Buying a Store-Brand Frozen Turkey
Typically, a turkey makes up about 40% of the cost of the Thanksgiving meal. Opting for a store-brand frozen bird rather than a fresh one, can significantly lower your total outlay for the meal.
8. Splitting the Costs
You may want to consider teaming up with a sibling or other family member to co-host this year’s gathering. That way, you can spit all of the costs, rather than foot the entire bill.
9. Buying Basics in Bulk
Buying staples like flour, potatoes, eggs, cream, and butter from a warehouse store like Costco or Sam’s Club can help you spend a lot less on food, as long as you’re not buying more than you need or will use up after Thanksgiving.
10. Going Generic
Many times, generic or store-brand products are just as good as the brand name version, and the only real difference is price.
11. Asking Guests to BYOB
Wine, beer and other alcohol can add up quickly. One easy way to save money is to ask each of your guests to bring their favorite beverage. That way, everyone will get to sip something they love, and you won’t have to shell out all that extra money.
12. Sticking With Seasonal Produce
Vegetables that are in season in November, such as sweet potatoes, squash, brussels sprouts and white potatoes, will typically cost a lot less than out-of-season picks, such as corn, asparagus and green beans.
13. Going With Frozen Veggies
If you want to use veggies that aren’t in season, you may want to choose the frozen versions, which are generally much cheaper than fresh.
14. Baking Your Own Bread
Baking bread can be fun and typically involves spending a lot less than buying rolls or loaves at a bakery. You can also make bread ahead of time and stick it in the freezer until the big day.
15. Going Simple with Sides
It can be tempting to try a new gourmet recipe you saw online or in your favorite food magazine, but fancy recipes often require specialty ingredients — and can end up costing a lot to make.
16. Not Going Overboard
You may love the idea of giving your guests a cornucopia of options, especially when it comes to appetizers and sides. But making a lot of different dishes can lead to a much longer and costlier grocery bill. And much of that food may end up going to waste.
17. Getting a Bigger Turkey Than You Need
Yes, this sounds like a way to increase costs. Going with a larger bird, however, can pay off by giving you several additional meals, like turkey sandwiches and turkey pot pies, that you can make later without going back to the store or spending another dime.
18. Considering Pre-Made Dishes
Sometimes, store-made dishes and desserts can actually be cheaper than buying all of the ingredients and making these things yourself. It can be worth doing some quick math at the store. This move can also save you time and stress.
19. Shopping Your Pantry
You may already have quite a few shelf-stable items in your pantry (maybe even from last Thanksgiving) that you need this year. It can be well worth the time and effort to give your cabinets a once-over before you head to the market.
20. Watching a Movie at Home
Though many people have a tradition of going out to the movies on Thanksgiving, theater tickets and concessions can be pricey. Instead, you may want to consider renting a movie from a streaming service (or finding a free one) that everyone can watch together on Thanksgiving night.
21. Not Going to the Mall
The average American dropped about $312 going shopping over the Thanksgiving holiday weekend in 2020, according to the National Retail Federation. If you don’t want to be tempted by Black Friday bargains, your best bet may be to avoid stores and stay off-line.
22. Using Up Airline Points
If you need to travel by plane over Thanksgiving, you may want to consider using any points you’ve racked up with the airlines or on your credit card to score a free or discounted ticket.
23. Going on a Staycation
While taking a vacation over the Thanksgiving holiday can be fun, it could add up to thousands of dollars between the flights, hotels, and rental car, depending on where you go. You may want to consider staying home and planning a series of local adventures instead.
24. Staying in an Airbnb
If you normally stay in a hotel when you visit family or friends over Thanksgiving, you may be able to save by going with an Airbnb instead, especially if you can share it with other people who are coming in from out of town.
25. Checking Warehouse Clubs for Travel Deals
Before you book any Thanksgiving travel, you may want to check for deals offered by your local warehouse club. If you are a member, you may be able to access discounts on hotels, rental cars, vacation packages and more.
26. Asking for Travel Discounts
Whether you’re renting a car or staying in a hotel over Thanksgiving, it can be a good idea to ask if you are eligible for any discounts when you book. You may be able to score a lower price if you’re a AAA member, a student, a resident of the state, a member of the military or over age 55.
27. Making a Budget
Whether you’re hosting or heading out of town, it can be a wise idea to come up with a total amount you can afford to spend on Thanksgiving. You can then make a list of expected expenses and determine how much you can realistically spend on each item.
28. Going DIY with Decor
A fun way to save money on Thanksgiving is to recruit the kids in the family to create your decorations. They could collect and paint pine cones, create cut-out turkeys (using their hands to trace them), or make a craft paper tablecloth where everyone can write or draw what they are thankful for.
29. Handing the Reins to Someone Else
Hosting can be fun and rewarding, but if you need a reprieve from the work — and expense — you may want to see if someone else wants to step up this year. You can offer to bring your famous balsamic roasted brussels sprouts and garlic mashed potatoes to make the host’s job easier.
30. Going Out to Eat
Local restaurants may be offering Thanksgiving specials to bring in customers. You could save big if you go out to eat (and split the tab) rather than host everyone at your home.
31. Volunteering for the Holiday
Helping out at a local soup kitchen can be a great way to get into the holiday spirit and have a chance to focus on giving back, rather than spending.
The Takeaway
You can enjoy Thanksgiving (and the upcoming December holidays) without running up expensive credit card debt that you may struggle to pay back. One great way to keep your holiday costs under control is to set up a simple budget and then make sure you stick to it by keeping track of your expenses as you go.
Learn more:
This article originally appeared on SoFi.com and was syndicated by MediaFeed.org.
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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
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Paying tax on personal loans
There are plenty of reasons to take out a personal loan, many of which are totally financially savvy. For instance, you might be thinking about consolidating high-interest debts like credit card balances.
Or you might plan to borrow in order to repair the roof or remodel the kitchen to help increase your home value.
Maybe you’re considering taking out an unsecured personal loan to pay for an unexpected medical bill.
Whatever the case, personal loans can be a useful tool to help you cover expenses and stabilize your finances. Plus, they may be easier to qualify for than other types of loans and come with less red tape.
But as in all things finance, Uncle Sam wants his cut, too. So, as you consider your borrowing options, you might wonder about how taxes work on unsecured personal loans.
For instance, you may question if a personal loan can be taxed as income and whether you can get a personal loan interest tax deduction.
If you are trying to decide between several types of financing, reviewing the potential tax implications of each borrowing option can help you figure out a financing strategy that fits your situation.
In this article, we’ll cover things you’ll likely want to know about when it comes to tax on personal loans, including whether personal loans qualify as income, and whether the interest on them is tax-deductible.
Plus, we’ll cover some scenarios that can come with tax benefits that might apply to you and your loan. This way you’ll be armed with helpful knowledge useful when making the right borrowing decisions for you.
It is, however, important to note that we’re not tax experts. For any tax-related questions or advice, you’ll want to consult a tax accountant — and not a blog post like this one.
Related: A guide to understanding your taxes
Depositphotos
When you take out a personal loan, your lender agrees to loan you a particular amount, and you agree to pay that loan back over a set period of time with interest.
Which is actually good news on the tax front: Even though it seems like a windfall that you could be taxed on, it isn’t. Since you are agreeing to pay that money back, it does not qualify as income the way wages from a job would.
The only instance when money from a personal loan can be taxed as income is if your lender agrees to forgive the loan. Loan forgiveness can be a rare occurrence and typically occurs under the following circumstances:
- You are renegotiating the terms of a loan you are struggling to repay.
- You’re declaring bankruptcy.
- Your lender decides to stop collecting on the loan.
This is called a cancellation of debt, and it can carry tax liabilities since you’re receiving the remainder of the loan without the caveat that you’ll be paying it back.
For instance, let’s say you’ve taken out a $10,000 personal loan and have paid back $8,500 of it when the debt is forgiven or cancelled. The remaining $1,500 that you’d no longer have to pay back can be taxed as income during the year it is cancelled.
Typically, your lender will send you a tax form (a 1099-C) stating the amount cancelled, which you must subsequently report to the IRS on your tax return. Again, this is a very, very rare circumstance, so it’s nothing to count on.
Bottom line: In most situations, personal loans are not taxable as income — but if your loan is cancelled or forgiven, the remainder of the loan amount that you’ve yet to repay can be taxed the same way regular income is.
Depositphotos
The IRS regulates which types of loans come with tax deductions. While there are some types of loans that have tax-deductible interest, unfortunately, personal loans don’t fit into that category.
The interest you pay on personal loans is not tax deductible. So, if you take out a loan and pay a few hundred dollars in interest over the course of your repayment, that’s not a cost that will reduce what you owe in taxes come April.
DepositPhotos.com
Although personal loan interest isn’t tax deductible, there are many other types of loans that do carry special tax benefits and interest deductions. For instance, student loan interest and mortgage and property loan interest can be deductible up to certain amounts, although there are some restrictions.
Michael Krinke
You may deduct up to $2,500 of interest on qualified student loans or the full amount you paid during the tax year,whichever is the lesser.
However, this deduction is gradually phased out as your income increases, and it is not available if you or your spouse can be claimed as a dependent on someone else’s tax return.
fizkes / istockphoto
In the majority of cases, you can deduct every cent of interest you pay on your home mortgage. The loan must be secured (that is, your home must be offered as collateral on the loan; this deduction will not work if you use an unsecured personal loan to cover some or all of the cost of your housing).
As of 2018, you can deduct the interest on up to $750,000 of a qualified home loan if married and filing jointly, or up to $375,000 of qualified debt for single filers. (These limits were lowered from $1 million under the Tax Cuts and Jobs Act of 2017, but if you signed your mortgage before December 16, 2017, you’re grandfathered into the previous limit.)
DepositPhotos.com
Some business expenses are tax deductible, and that includes the interest you pay on loans taken out for business-related purposes. However, you can also deduct business expenses you pay for using an unsecured personal loan, which we’ll dive into a little bit more deeply in the next section.
DepositPhotos.com
Although staying debt-free is standard financial advice, sometimes taking out a personal loan can be a smart money move, especially if you’re already dealing with high-interest forms of debt, such as consumer credit cards.
Debt consolidation, a financial tactic, which involves taking out one large loan to cover multiple smaller debts, may reduce your credit utilization ratio and potentially help you save money on interest, not to mention make your bill-paying schedule a whole lot simpler.
For example, maybe you owe $8,000 on one personal credit card and $4,500 on another credit card, both with high (and different) interest rates. With multiple bills coming due at different times of the month, chances are you’re only paying the minimum required amount on each of them, which means you’re paying them off slowly and paying a lot of interest.
However, if you were able to qualify for and take out a $12,500 personal loan at lower interest rate, you’d only have to worry about one payment date, and you might even save money on the sky-high credit card interest rates, which could simplify both your life and your finances.
Personal loans (home improvement loans) can also help you get started on major home renovations, which may increase the value of your house and help you earn back your investment in the form of equity.
Learn more:
This article
originally appeared on SoFi.com and was
syndicated by MediaFeed.org.
Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
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