How to Holiday Shop When You Have Student Loan Debt

If you're on a tighter budget this holiday season because you're working toward paying your student loans, consider these tips to help you shop smart.
Leslie Tayne

Many of today's millennials are burdened by heavy student loan debt that can lead to emotional and financial stress over the holiday shopping season. According to a 2016 survey from research agency TNS and Citizens Bank, adults between the ages of 18 and 35 have an average of $41,286.60 in student loan debt. That kind of debt can make it very hard for young people to hit other important milestones, like buying a home or even a car — let alone affording the gifts on their loved ones' holiday wish lists.

Here are some tips to help graduates balance their holiday budgets and student loan debts.

1. Have a Positive Attitude

Yes, you may be in a large amount of student loan debt, but that's OK. You're not alone. There are many graduates out there in a similar situation as yourself. If you are comfortably making monthly payments on top of your other bills, then this is great news. You are only building a solid credit history. (You can see how your student loans are affecting your credit by viewing two of your credit scores, updated every 14 days, for free on Try not to look at the amount of debt you owe, as this will only bring you down. Consider choosing an end date with your student loans (earlier than your term) to get you motivated.

2. Design a Holiday Budget (Your Student Loans Included)

This year's holiday budget may be different than last if you now have the burden of student loans. You may have to make some sacrifices and limit yourself to a lower budget per family member or friend. If you don't have extra cash to spend, you might want to consider cutting back on some non-essential expenses to put more money toward holiday spending. This may mean bringing a bag lunch to work instead of eating out or sacrificing some weekends out to avoid social spending.

After your budget is made, make a list of each person you plan to buy a gift for. Give each family member or friend a limit (i.e.: $50, $75, $100). Consider choosing an amount based on how much money you have to spend – divide it accordingly and try your best to not go over.

3. Create a Holiday Spending Fund

Even though the holidays are around the corner, it doesn't mean you should stop saving. Consider putting aside extra cash to use solely for holiday shopping. You might even want to put cash into separate envelopes, so that when you go off to the store all you will bring with you is the exact cash you need. This will help you avoid impulse-buying and credit card debt.

4. Put More Money Toward Your Loans in Advance

If you have some time before the holidays begin, consider putting extra money toward your loans. This means end-of-year bonuses, birthday money, credit card rewards, money from your grandparents – whatever it may be. This way, when you start your holiday shopping, you won't be worried you have to make more payments to meet your principal, as you did that the month prior.

Note: You should be able to specify how you would like the extra payment(s) applied in your online account, but it's still a good idea to call your lender ahead of time to be sure the payments go toward the loan you intended — and to verify whether you would like the funds applied as a prepayment or toward your principal.

5. Consider Making DIY Gifts

If you are on a tight budget and struggle to meet your monthly student loan payments, you might want to consider creating your own, personalized gift for each family member this year. Remember, it's not about how much the gift costs; it's about the meaning behind it.