Christmas In July: How Much Can You Save?

By Remi Alli | July 12, 2010 AAA
Christmas In July: How Much Can You Save?

Some historians and theologians believe that the date of Jesus' birthday, also known as Christmas, is unknown, and may actually take place in the summer. But when it comes to "Christmas in July", it is commonly believed to have begun after World War II, when retailers began noticing a sales drop after the Fourth of July and discovered that getting consumers on the holiday shopping bandwagon earlier was a good way to increase sales.

IN PICTURES: 6 Ways To Save Money This Summer

Why Retail Shops Love It
According to the National Retail Federation, Americans spend more than $400 billion around the holiday season, with the average American spending around $700 dollars on gifts. Retailers hope that those who also celebrate "Christmas in July" for reasons such as friends or family reunions, an extra holiday party or even curtailing prices will spend considerably more by spreading their shopping over a greater number of months. It also helps retailers move items that may not be selling in the slower summer months. (Learn more in Keep Holiday Debt From Snowballing.)

Why You Should Love It
"Christmas in July" is more about shopping than a real holiday, although organizations often have "Christmas in July" community service. Many U.S. stores promote "Christmas in July" sales. Last year, in a very tough retail climate, big-name retailers such as Sears (Nasdaq:SHLD), Toys R Us (NYSE:XKE) and Kmart held winter- or Christmas-themed sales through the summer. Television home shopping network QVC also typically holds a well-publicized Christmas in July sale.

Since corporations are generally looking to hike prices during the holiday months, Christmas in July is a frugal-minded alternative for those looking to save cash. Value wise, prices tend to be much lower although the items are mostly of the same quality. Retailers tend to drive prices up during the holiday season because stressed shoppers are less likely to resist paying up for that "perfect gift".

Additionally, people can use the warm-season alternative in order to start preparing for the actual December holiday by ordering items now. This allows for ample time to purchase items earlier and make returns as needed. And with your shopping done early, you can spend December tying the bows on your presents, baking cookies and actually enjoy the holidays, rather than scrambling around for last-minute gifts.

Frugal Tips
If you don't finish all your shopping this month, there are other great days to shop for less. This includes Black Friday, or the day after Thanksgiving, when prices are known to decrease considerably, especially on appliances and other technological gadgets. You could also just keep your eyes open for great prices on gifts all year long, and shop when you find the item you want at a good price. (Find out what happened on the top shopping day in 2009 in Biggest Stories From Black Friday '09.)

We Wish You a Merry Christmas
December is the largest holiday season for retail sales, while July, the dead of the summer, tends to be one of the slowest for sales. For retailers, Christmas in July provides an opportunity to boost sales in the summer, but that doesn't mean that consumers have to be left spending more money. For shrewd shoppers, getting started in July may be a great way to save money, reduce stress and avoid the crowds. (For more, see Holiday Spending Or Spending Holiday?)

Catch up on the latest financial news; read Water Cooler Finance: I-Spy, IPOs And iPhones.

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