Oops! 6 Holiday Costs We Forget to Budget For

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By Susan Johnston Taylor

The National Retail Federation predicts that the average spending on food, gifts and other holiday costs this year will reach $805.65 per person, just slightly higher than last year's average of $802.45.

Whether you're planning to spend more or less than average, forgetting to factor in extras like the holiday ham or a gift for your great aunt Mildred could derail your budget. Fortunately, there's still time to set aside some extra cash and plan your spending.

Here's a look at several items we forget to include in our holiday budget.

1.Holiday dinner. Hosting a holiday party? Expect your grocery bill to spike, especially if it's a sit-down dinner. "If you're going to have a ham or pork roast and have 20 people over, that can be really pricey," says Deacon Hayes, financial expert with WellKeptWallet.com and U.S. News My Money blog contributor. To minimize costs, make the meal potluck or BYOB, or serve appetizers or desserts rather than a full dinner. Also try to buy meat when it's on sale, as that's often the priciest part of the meal.

2.Travel costs. Airlines for America, an industry trade organization, projects that the number of air travelers will rise 3 percent during this year's 12-day Thanksgiving travel period – averaging about 65,000 more passengers a day compared to last year – driven in part by lower airfare made possible by greater competition.

If you're planning to fly in November or December, then cheaper airfare is welcome news. But with a growing number of airlines now charging for checked baggage, fees could wipe out the savings. If you're planning to check bags (maybe to carry presents or cold-weather apparel), Hayes suggests factoring that into your airline choice. "If you're a family of four, $50 extra per person is an extra $200," he says. (Remember, that's one-way.) Southwest Airlines lets passengers fly with two free checked bags, and you also may get free checked bags if you have an airline credit card or elite status with a particular airline.

3.Self-gifting. Holiday sales can create the urge to "self-gift," buying items for yourself you might not normally buy while you're on the hunt for others on your gift list. NRF predicts that more than half (55.8 percent) of holiday shoppers will splurge on themselves and/or others for non-gift items, spending an average of $131.59.

Even the experts aren't immune to this temptation. "I know that if I walk into Best Buy, I get distracted with all the cool gadgets in there," admits Kathleen Grace, a certified financial planner and managing director at United Capital's office in Boca Raton, Florida. "I was in there buying a tablet for my daughter's birthday, and I walked by the Fitbits." (She resisted the temptation but also dropped hints to friends in case they're looking for gift ideas for her.) Grace tries to shop online for this reason. Another way to prevent overspending on self-gifts is to give yourself a cooling off period. The desire for the item often dissipates a few days after you've left the store and given the purchase more thought.

4.Festive outfits. Holiday party invites can bring the urge to buy a new outfit or two, whether for a black-tie dinner with clients or an ugly sweater party with roommates. "Is it necessary to buy a new outfit?" Grace asks. "It goes back to needs versus wants." If it's within your budget, it could make sense to invest in a few timeless, high-quality items you'll re-wear or inexpensive accessories that dress up items you already own.

For trendier items you'll only wear once, consider swapping dresses or accessories with friends or renting through services like Rent the Runway. And for ugly sweaters, hit your local thrift store. You can always embellish with ribbon or fabric scraps if you want to up the kitsch factor.

5.Extra gifts. If you're a planner, you've probably already set aside cash to buy gifts for close friends and family. But sometimes gifting needs creep up on us. "People forget about the one-off, the uncle or the aunt or the neighbor to give a gift," says Kimberly Foss, a certified financial planner and president and founder of Empyrion Wealth Management, which has offices in Sacramento, California, and New York. "Or going to holiday parties, they don't plan the expense to bring a gift." She suggests making a list of how many gifts you need to buy for the holiday season so you're not caught off guard.

Surprises can still happen, like when you discover last-minute that your cousin's friend's roommate is coming to Christmas dinner or your co-worker surprises you with an unexpected gift card. For situations like this, Hayes suggests having a gift box in which you keep generic gifts in your house like candles or bottles of wine. "Another way to make sure everyone gets a gift without breaking the bank is to make some caramel popcorn, divide it into multiple smaller bags with ribbons on them and attach a small little personalized note," he says.

6.Credit card interest. If you forget to plan for these items and go over budget, then credit card interest could be another unintended consequence of holiday spending. If you must carry a credit card balance, try to use the card with the lowest interest rate, or take advantage of a 0 percent introductory period and pay off the balance before the grace period ends.

Foss recommends that clients shop with cash only so they can't overspend. She also suggests using Acorns, an Android and iOS app that automatically rounds up everyday purchases and invests the spare change for you. "I've done that for a year now, and most people are amazed [how quickly it adds up]," she says. That way, you won't have the guilt of extra credit card bills come January.

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