I've found a benzodiazepine (which Xanax is) useful if I use it in a very, very restricted way. Since they're associated with dependency, and the need for increasing quantities, and also with possible side effects from prolonged use like hallucinations, I wanted to minimise my use of them. I'm glad you're thinking the same.
What worked best for me was actually moving away from the benzodiazepine as much as possible, and taking one beta blocker a day for about 10 days while using that time to do a ton of work on skills to reduce/manage the anxiety. I really mean a ton of work - 2 to 3 hours a day of practising the exercises. I don't know if you're practising them when you're not anxious, but that's how to make them second nature so you don't have this situation:
the reason I started taking Xanax is because my anxiety and panic attacks get so bad I can't even remember how to do the coping skills in the moment. I'm finding that when I take even half of the .25mg Xanax it calms me down enough to where I can actually use the coping mechanisms I've learned.
I would like to gently challenge this a little. Or rather, I would like to ask whether you could gently challenge yourself a bit more here. For example, identifying a single "go to" exercise to do if you're having a panic attack, writing that on a piece of paper and wrapping your Xanax in the paper - so you see (and try) the exercise before you take one. For me the go to exercise is always breathing techniques. Even if the exercise is not very effective at first, simply trying to concentrate on doing it can have some grounding effect.
Of course, it probably won't work well at all at first - that's why we need to practise. But I think it's important not to establish a routine of "take Xanax - do coping exercises" and instead "try coping exercises - take Xanax if still needed".
Or better, to give yourself a one to two week period where you do take something each day, but are then working proactively on building up coping skills. Not just reactively by using them after you've had a panic attack, or even practising them a bit on top of that. What I'm suggesting is using Xanax (or whatever) to enable you to do a sort of coping skills boot camp, so that by the end of 10 days or so, you will definitely remember how to do the coping skills before taking anything, and they will be working much more effectively for you.