diy gifts

Frugal gifting often gets a bad reputation. However, this shopping method does not make you cheap — it makes you practical. Frugal gifts often avoid waste and overspending and can be just as meaningful (if not more so) as any other present.

With the National Retail Federation predicting each consumer this holiday season to spend upwards of $1,000 on holiday gifts amidst an economic recession —this year might be the perfect time to reconsider your spending budget. We've formulated the ultimate list of frugal gift-giving ideas to get you started.


Baked Goods

Cookie exchanges have become a tradition throughout America — so there's no reason gifting homemade food can't also be an acceptable gift during the holidays. Gifting someone with homemade food not only saves you money but, more importantly, shows you took the time and care to make something and that it has the most important ingredient in any recipe: love.

Try this: Fill mason jars with everything needed to make cookies, pancakes, or hot cocoa and decorate with some festive swag.

Experiences

Jess and Rory in Gilmore Girls Giphy

A few years ago, my aunt gifted my children season passes to our local zoo. It was the best gift I never knew my children were missing. Gifting experiences, rather than material possessions, is a great example of frugal gift-giving. Some examples are season pass admissions to museums or zoos, even tickets, movie passes, and much more.

Try this: Admission to zoos or museums, event tickets, or movie passes.

Donations to Charity

A sure-fire way to feel frugal about your spending this holiday season, a charity donation in lieu of gifts is something almost everyone can appreciate. Make it personal by specifying donations to charities near and dear to the gift recipient.

Try this: Given the current health environment throughout the country, donating to Doctors Without Borders, the nonprofit organization that provides medical aid where it's needed most.

Regifting

Seinfeld regifter

The regifter has long been given a bad name, such as in the famous Seinfeld regifter episode. But there's nothing wrong with passing along something pre-owned that someone else can use.

Try this: Everyone loves candles, and there is a good chance you have an unburnt candle somewhere in the house.

Socks and Underwear

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It was ingrained in my brain throughout my adolescence that getting socks or underwear for Christmas was the worst possible gift. I have come to realize, however, that these essentials are probably one of my favorite gifts to receive, as it's something I always need and rarely take the time to buy myself.

Try this: If you want to impress them with your undergarment shopping abilities, impress them with a new pair of socks or underwear from MeUndies.

Subscription

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The gift that keeps on giving, a subscription gift is something to be enjoyed long after Christmas. From books and magazines to streaming subscriptions, it's easy to find a subscription service tailored perfectly for every person on your list.

Try this: For the coffee lover, try a subscription to Trade Coffee.

Grocery Store Gift Card

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No one has ever been mad about receiving a grocery store gift card for a present. To save money, check local grocery stores that might have gift card specials.

Gift Your Time

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As Benjamin Franklin put it in 1747, "Lost time is never found again." Since our time is such a valuable gift, it is the perfect way to show your friends and family you care.

Try this: For the friend that cooks dinner for the family every night, give them a voucher to make them a full course meal so they get a break one night.

Gifts from the Garden

Bob's Burgers Giphy

As people spend more time at home this year, more people are turning to gardening from home, and there's no better time to turn your outdoor garden or plants from the store into a frugal gift this holiday season.

Try this: These mason jar wall planters are perfect for the DIY enthusiast to recreate and would look amazing on a kitchen wall holding cooking herbs.

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The Federal Reserve sets the guardrails for the federal funds rate, and through that helps control the money supply for the nation.

When you take out a loan for a car, charge something to your credit card, or get a personal line of credit, there is going to be an interest rate that applies to your loan.

A lot of different factors go into what you will be charged, including your own personal credit score. But even those with flawless credit still see a minimum charge that they can't get around. That all goes back to the Federal Funds Rate.

One thing consumers rarely realize is that all of our banks are lending money to each other every night. Banks are legally required to maintain a certain percentage of their deposits in non-interest-bearing accounts at the Federal Reserve to ensure they have enough money to cover any withdrawals that may unexpectedly come up. However, deposits can fluctuate and it's very common for some banks to exceed the requirement on certain days while some fall short. In cases like this, banks actually lend each other money to ensure they meet the minimum balance. It's a bit hard to imagine these multibillion-dollar financial institutions needing to borrow money to tide them over for a bit, but it happens every single night at the Federal Reserve. It's also a nice deal for those with balances above the reserve balance requirement to earn a bit of money with cash that would normally just be sitting there.

The Federal Reserve The Federal Reserve


The exact interest rate the banks will charge each other is a matter of negotiation between them, but the Federal Open Market Committee (FOMC) (the arm of the Federal Reserve that sets monetary policy) meets eight times a year to set a target rate. They evaluate a multitude of economic indicators including unemployment, inflation, and consumer confidence to decide the best rate to keep the country in business. The weighted average of all interest rates across these interbank loans is the effective federal funds rate.

This rate has a huge impact on the economy overall as well as your personal finances. The federal funds rate is essentially the cheapest money available to a bank and that feeds into all of the other loans they make. Banks will add a slight upcharge to the rate set by the Fed to determine what is the lowest interest that they will announce for their most creditworthy customers, also known as the prime rate. If you have a variable interest rate loan (very common with credit cards and some student loans), it's likely that the interest rate you pay is a set percentage on top of that prime rate that your lender is paying. That's why in times of low interest rates (it was set at 0% during the Great Recession), a lot of borrowers should go for fixed interest rate loans that won't increase. However, if the federal funds rate was relatively high (it went up to 20% in the early 1980's), a variable interest rate loan may be a better decision as you would be charged less interest should the rate drop without the need to refinance.

The federal funds rate also has a major impact on your investment portfolio. The stock market reacts very strongly to any changes in interest rates from the Federal Reserve, as a lower rate makes it cheaper for companies to borrow and reinvest while a higher rate may restrict capital and slow short-term growth. If you have a significant portion of your investments in equities, a small change in the federal funds rate can have a large impact on your net worth.

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