Festive shopping on a budget: Smart tips to avoid financial stress

By prioritising needs and sticking to a well-defined budget, shoppers can enjoy the festive season without falling into the trap of unnecessary debt.

The festive season is upon us, and with Navratri and Dusheera in full swing, e-commerce websites have already kicked off their festival season sales. Amazon's Great Indian Festival and Flipkart's Big Billion Days sale are live, offering a wide range of products at discounted prices. Add to this the recent GST cuts, and it's the perfect time to shop without breaking the bank.

The festive shopping spree is driven by enticing loan offers, Buy Now Pay Later (BNPL) schemes, and Equated Monthly Instalment (EMI) options from banks, Non-Banking Financial Companies (NBFCs), and fintech lenders.

However, it's essential to approach these sales with a smart spending strategy to avoid overspending and financial stress.

Here are tips to help you make the most of the festive sales while keeping your finances in check.

Prioritise needs and budget wisely

The temptation of discounts during sales can blur the line between needs and wants, leading to impulsive purchases. Rishabh Goel, co-founder and CEO of Credgenics, a debt collection and resolution platform for banks, NBFCs and fintechs, emphasises the importance of distinguishing between essential expenditure and discretionary splurges. High-priority purchases, such as educational tools, urgent household needs or travel for meaningful experiences, should take precedence over luxury items like high-end gadgets.

Having an idea of how much to spend on what is crucial to cap spending and avoid borrowing beyond one’s means. Rohan Bhargava, co-founder of CashKaro, a cashback and discount coupons app, echoes this sentiment, advising consumers to “set clear, category-wise budgets” and track expenses in real time using budgeting apps.

By prioritising needs and sticking to a well-defined budget, shoppers can enjoy the festive season without falling into the trap of unnecessary debt.

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Maintain a healthy EMI-to-income ratio and automate repayments

To safeguard financial health, Goel recommends keeping total EMI obligations within 30 to 40 percent of monthly income. This ratio ensures room for savings and unexpected expenses, reducing the risk of missed payments that could damage credit scores.

Automating EMI repayments through auto-debit systems is another effective strategy to minimise the chance of late payments, and preserving financial discipline. Bhargava highlights the ease of opting into BNPL and no-cost EMI schemes but warns that they can “stretch financial obligations into the new year”.

Avoid multiple loans and scrutinise loan terms

The season’s excitement often tempts consumers to take on multiple loans while shopping but Goel advises against this, as juggling several EMIs can lead to financial strain.

Additionally, thoroughly reviewing loan terms—such as interest rates, hidden fees and penalties—is critical to avoid surprises. A seemingly affordable EMI may conceal high interest costs over a long tenure, significantly increasing the debt burden.

Bhargava reinforces this, urging consumers to “be mindful of the debt trap” and treat their festive season budget as a strict ceiling. By resisting the urge to accumulate multiple loans and carefully examining loan terms, shoppers can make informed decisions that align with their financial goals.

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Shop smart and maximise savings

Beyond disciplined borrowing, Bhargava suggests leveraging cashback platforms to enjoy savings on top of bank offers and platform deals. “Savvy shoppers are stacking up bank offers, platform deals and cashbacks to make the most of festive buying,” he notes.

However, he cautions against letting FOMO or the fear of missing out drive purchases, stressing the importance of spending only what one can afford today.

By combining smart budgeting with strategic use of discounts and cashbacks, consumers can maximise value without compromising financial stability.