Tariff-Proof Your Holiday Shopping

Dreaming of one of those cars with the big bow appearing in your driveway over the holidays? Better temper those expectations—tariffs could tack on thousands to the price tag. And that's just one high-profile example of how trade tensions might squeeze holiday budgets this year.

If you're worried about tariffs affecting your holiday shopping, you're not alone. A recent survey found that 81% of parents are concerned about the impact of tariffs on their families, and 58% intend to change their holiday shopping habits this year.

With prices rising on everything from toys to trees, the question is: How do you keep holiday traditions alive without blowing your budget? Here's what you need to know to shop smart this season.

How Can Tariffs Affect Holiday Shopping?

While the tariff landscape remains unsettled, consumers and retailers are already bracing for substantial impacts:

Household budgets under pressure

Households could be on the hook for an extra $2,300 in tariff-related costs, according to the Yale Budget Lab. That squeeze is already reshaping consumer behavior: PwC's 2025 Holiday Outlook reports that 84% of shoppers plan to cut back—the first notable pullback in holiday spending since 2020.

Limited inventory and higher prices

Worried about rising costs, many retailers are playing it safe with smaller inventories. That could mean less selection on shelves—and fewer of the deep discounts shoppers have come to expect.

New fees for online purchases

The end of the “de minimis" exception—once allowing packages under $800 to enter the U.S. tax-free—is already hitting shoppers. That means almost anything you order from overseas could now cost more, whether it's shipped straight from an international brand (think fast fashion) or brought in by retailers who pass the fees along.

When buying online from international retailers, watch for these key phrases:

• Delivered duty paid: The seller covers import taxes.
• Delivered duty unpaid: You're on the hook for the fees.

Most major carriers say they'll alert customers about duties before or at delivery, so keep an eye on your order confirmations and shipping emails for payment instructions.

Purchases Most Likely To Be Affected by Tariffs

While many categories could get a price bump, these four are most likely to see sharp increases this holiday season:

• Clothing: Over 98% of clothing sold in the U.S. is imported.
• Toys: Nearly 80% of toys originate from China.
• Cars: Vehicles under $40,000 could cost up to $6,000 more. Even used cars may spike as shoppers shift away from new purchases.
• Decor: Christmas decorations alone could run 15% to 20% higher than last year.

Eight Smart Holiday Shopping Strategies

Tariff uncertainty may be creating new challenges, but these strategies can help you maintain your holiday traditions and your financial goals.

1. Set a realistic holiday budget

It's timeless advice, but more crucial than ever as prices rise. Your budget should cover not just gifts, but also meals, decor and travel—with a small cushion for surprises. Clear limits give you control, helping you spend intentionally and jump on deals with confidence.

Don't have a budget? Here's how to make one.

2. Prioritize and scale back strategically

With less wiggle room in your budget, focus on what matters most to you and your loved ones. Decide which holiday activities are favorites and where you can trim—like capping gift exchanges or turning a lavish holiday dinner into a festive potluck. Small shifts can protect your traditions without breaking the bank.

3. Have honest conversations with kids—early

Children are often most affected by holiday budget changes, but with clear communication, they can adapt. Talk with them about prioritizing wish lists, and grab the top items early before the shelves empty. This is also a valuable opportunity to discuss budgeting and money management in kid-appropriate ways.

4. Give experiences rather than things

Chances are, most people on your list already have plenty of stuff. That's why experiences—like tickets, memberships or planned outings—often feel more meaningful. These gifts can also spread costs into the future, easing the holiday crunch. Even better, consider giving your time: Cooking a meal, running errands or pet-sitting can be gifts that are truly valued (and budget-friendly) for busy households.

5. Shop secondhand for unique finds

Pre-owned shopping has gone mainstream. ThredUp's 2025 Resale Report found that 58% of U.S. consumers bought secondhand last year, including 68% of millennials and Gen Zers. With clothing and other imports facing price hikes, secondhand shopping offers a smart way to score quality items at lower prices while cutting your environmental impact. Try sites like Poshmark, TheRealReal and ThredUp for vast searchable inventories, or look closer to home with Facebook Marketplace.

6. Use gift cards strategically

If you feel like your dollar isn't stretching as far as you'd like, there's one popular gift untouched by inflation: gift cards. After all, a $50 gift card is still worth $50. You may even find discounted cards through warehouse clubs, credit card rewards or online resale sites, stretching your dollar further.

7. Stack your savings

Maximize every purchase by combining cash back apps like Rakuten or TopCashback, credit card rewards, store loyalty programs and seasonal promotions. Used together, these tools can add up to big savings across your holiday shopping.

READ MORE: 12 Black Friday Shopping Tips to Maximize Your Savings

8. Focus on the moments that matter

Remember that the most prized holiday memories often cost little to nothing. Sipping hot chocolate after a chilly walk to see the lights or volunteering together at a local food bank costs little but delivers the kind of magic that lasts.

Proactive Planning Keeps the Holidays Merry

Holiday budgets may feel tighter this year, but a little planning and flexibility can help you celebrate without sacrifice. It's also the perfect time to revisit your savings strategy and build a financial cushion for the unexpected.

Consider keeping extra funds accessible in a high yield savings account or money market account, where your savings can earn interest while remaining available for surprise expenses or last-minute opportunities. For any holiday funds you won't need immediately, a certificate of deposit (CD) can provide guaranteed returns and help separate this money from everyday expenses, making it a good start to saving for future holiday seasons.

READ MORE: How to Get More Joy from the Holidays