The holidays are upon us, bringing all those feelings and temptations to go overboard with spending. Whether its a dedication ...
The holidays are upon us, bringing all those feelings and temptations to go overboard with spending. Whether its a dedication to the gift-giving tradition, a sense of obligation, or a feeling that the holidays entitle us to have a little more fun than usual, too many of us seem to turn a blind eye to our budgets. Excessive holiday spending can cause unnecessary financial stress on you for months afterwards. With proper planning, you can have a wonderful, memorable holiday and avoid the financial hangover afterwards. Here are some tips on how to keep your holiday spending in check.
Pool on a holiday outing instead of gift-giving during the holidays.
Many people feel they have to give gifts during the holidays, either because of tradition or because they know their friends and relatives have gotten gifts for them. Instead of exchanging gifts, your family members might want to pool their money and spend it on a holiday outing. This is a great alternative to gifts that is more meaningful, and chances are they will be happy to save gift-buying dough as well.
Plan for gift-buying by cutting your expenses elsewhere as necessary.
Perhaps youd rather dine out or go to the movies less, or maybe you can forego that new pair of shoes youve been wanting for yourself. It doesnt matter where you make cuts, just that you make them. Keeping your other spending under control while youre out there doing your shopping can be a challenge, but just keep repeating to yourself the importance of not over-spending. That way when it comes time to actually pass out those presents youve purchased, you can do it without grimacing as you think about the damage they did to your bank account.
Set a budget and keep tabs on what you are spending.
While youre doing your holiday shopping, keep close tabs on your checkbook register, credit card statements, and all of your receipts. Its easy to get into a spending rhythm when shopping for yourself or others, and thats why you need to write down every purchase you make and make sure you dont go over your budget. Most people dont budget their shopping and dont realize that by the time they buy all the presents, wrapping paper, cards, decorations, etc., its already added up to a ridiculous amount. Having a budget that you know you must stick to will help keep your impulse spending from getting out of hand and will help you hone in on the most reasonably priced holiday items.
Plan what you are going to buy, and skip the extras.
Along with your budget, youre going to want to take an exact list of what you want to buy for your gift recipients. Dont go shopping for someones gift until you know exactly what you are going to buy. Its very easy to go in with no plan, see something you like, and get it simply because you have no idea what else to get for a hard-to-buy-for relative despite the gifts significant price tag. A list will also help you squelch the desire to buy knickknacks that you think will make nice small additions to the gifts youve purchased. Very rarely are things like this necessary, and if youve got your list in hand, it will be easier for you to pass them by without hesitation.
Watch out for deals that seem too good to be true.
Retailers run all sorts of specials to induce consumers to buy now. For example, furniture stores frequently offer that if you buy now, you dont have to pay a thing for a year, and you might even get free delivery. This sort of push marketing can make it harder for you to say no. Retailers find that buyers are less likely to negotiate the price if they are getting a short-term financing break. Read the fine print on any deal you are considering taking before you go to the store to make the purchase. It can be even harder to say no once you get to the store, so youll want to know what you are in for before you get there.
Leave the plastic at home.
Charging items to a credit cards and deciding to pay it off gradually after the holidays is a bad idea and only creates unnecessary financial stress for you after the holidays. Use your budget to figure out how you can purchase the gifts you want to purchase without putting them on your credit card. If you are so cash-strapped that you think it will be difficult to avoid charging gifts, then you may want to sit down with other friends and family and propose a limit on how much gifts can cost this year -- or propose no adult gift exchanges at all. Far from being disappointed, its likely theyll view this reprieve from gift-buying as a gift in its own right.
Remember that meaningful gifts dont necessarily have a big price tag.
Sure, it might be nice to give a brand new TV, but there are other things out there that will be even more meaningful. If you are looking to give a gift that truly means something and that will keep its value for years to come, you are better off looking for nonmaterial gifts to give than for something your gift recipients could get themselves at the local store.
Money can easily become the focus of the holidays when it should be the last thing you are thinking about. If you prepare properly, you can achieve a happy balance of spending and saving during the holiday season.