Avoid the holiday debt hangover by planning ahead.
Last holiday season, Americans gave themselves a gift: More than $1,300 in debt. On average, that’s how much 1 in 3 overspent on gifts, meals, decorations, and all other holiday items. Even worse: 3 in 5 are stressed about that debt, according to an annual study from personal finance website MagnifyMoney.
As the new holiday season approaches, some of us are still paying off last season’s spending. Here’s how to plan now and avoid another holiday debt hangover…
1. Take inventory
The easiest way to save money? Don’t spend it. You might have what you need in forgotten recesses in your home. Look through the garage, attic, and closets for dusty decorations and unopened items from years past. You might find a blender your in-laws sent you that you never bothered to use. Dare we say re-gift?
2. Make a list and start early
Look back on what you’ve spent historically. Consider every family member, coworker, friend, neighbor, and kid’s teacher worthy of your holiday spending. Jot down their names and how much you plan to spend on each. Then consider expenses aside from presents. Budget all your holiday spending from dining out to travel costs.
3. Download a holiday budgeting app
Santa’s Bag for iOS and Christmas Gift List for Android make holiday budgeting easier. You’re able to set and track your spending. These apps will update your budget every time you check a gift off your list and input how much you’ve spent.
For additional tips, check out How to Make a Holiday Budget.
4. Research the best deals
Price out what you plan to purchase over the next few months. You may have a brick and mortar discount store close to home. But it’s worth checking online to see if there’s another that can beat its prices. You have time to search now. Bargain hunting will be a lot more competitive in a few months.
5. Check your math on holiday sales
Debt.com has previously reported that 56 percent of Americans struggle to calculate the true cost of a holiday sale. They end up losing money because they can’t properly calculate the price of an item after a discount percentage is applied. Don’t make impulsive decisions during the hustle and bustle. Stop and breathe. Retailers and marketers plan for you to fall into their trap.
6. Set up a holiday savings account
You don’t need to go into debt if you have cash set aside. If you don’t have the money to simply move over to a separate account, start socking away money now. And don’t combine with your usual savings account. Catch-all savings accounts with both holiday and emergency funds get confusing. Plan it right and meet your goal come November.
7. Use email to your advantage
A Google account is free to set up, and you’re able to have more than one email. Create one specifically for your holiday shopping. Use it to subscribe to email lists at the stores you plan to shop at. Those pesky notifications might get annoying – but, buried in their promotional spam may be coupons, discounts, and free delivery services.
8. Cut wasteful spending
Do you habitually throw that celebrity magazine and Snickers bar in your cart at the grocery store? Take note of that kind of spending and stop. You can free up more cash for the holidays that way. Those little, unnecessary expenses add up to a lot. Every candy bar you don’t buy now can prevent you from swiping the Visa or Mastercard later.
Published by Debt.com, LLC