5 Tips to Avoid Holiday Debt and Overspending
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Ever hear the expression "post holiday hang over?" That's what it feels like when we open up our January credit card statement. Talk about quickly deflating the joy of the holiday season. "People on average spend $1,800 on Christmas gifts with money they don't really have," stated Debbie Kidd of the Homeownership Resource Center, as quoted in WCSC news segment.
"62 percent of consumers said they would spend more than they have budgeted if it means finding the perfect gift," according to Javelin Strategy & Research as posted in a recent businessnewsdaily article. Javelin went on to state "consumers spend more money on a single online transaction using credit cards than when using other payment options."
With a little planning and creativeness, we all can avoid holiday debt and the post holiday blues and don't forget to include your kids in the process. Here are our 5 tips for a truly money-smart holiday season:
- Set up a holiday budget. Before you do anything else, you have to have a base to start from. How much can you afford to spend this holiday season? By having a clearly defined budget will help you from overspending. For your kids, have them create a goal in FamilyMint for ever gift they are saving up for. This is budgeting made simple!
- Make a list and check it twice. Identify who wish to buy gifts for, how much you want to spend on them and any ideas as to what they might want. This is where creativity really kicks in and the kids can be a huge help here. Making or baking gifts can save a lot of money and often touch peoples hearts far more than store bought purchases.
- Do your research. The advent of the Internet has dramatically simplified the shopping experience. I'm not trying to take the joy and tradition out of walking through the stores, seeing all the decorations, smelling all the holiday smells and feeling the merchandise. I'm just saying start on the Internet. You can quickly find who has your item for the lowest cost along with special offers and discounts that might be included. Of course many of the best deals might just be found online. That's okay too. The key is your armed with the best information to make the wisest purchase decisions.
- Stay on task. This is no time to start shopping for yourself. It is often tempting with those buy 1, get 1 at half price to say "what the hey, I could use one of those." This only adds to the bottom line and besides, you have all next year to shop for yourself.
- Limit the use of credit. Yes, I know this is tough one, especially with all those extra bonus points we get during the holidays. But according to the research quoted above, we are more likely to deviate from our budget using credit cards than cash. If you are shopping online, use your debit card instead. But in every instance, always refer back to tip #1.
Start with a budget and stick to a budget and your holiday joy will carry forward long into the new year.
Wishing you a very happy and joyous holiday season.
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