As we head into the holiday season, many will get the biggest surprise of all – not from the gifts under the tree – but from the credit card bill in January!
It doesn’t have to be this way if you do a little planning and stick to your list. Below are some tips on ways to beat the January credit card blues
- Start by evaluating your gift list. Giving a gift is nice but not worth it if it is going to mean mounting debt, significant stress and anxiety. Start by speaking with your friends and family and seeing if they would be willing to do a Secret Santa exchange where you only have to buy one gift. You never know – they may be looking to save some money as well, and I am sure they would rather not have a gift if they understood the stress and anxiety it was causing.
- Set a budget on how much you can afford and determine how much you can spend on any one gift. This can be the hardest one to keep but can make all the difference.
- Planning ahead is a must. Attempt to purchase gifts throughout the year so you don’t have a huge amount of expenses all in December.
- Only buy things on sale. If you are shopping year-round the item you would like to buy will go on sale. Every store has to turn over their inventory and will do it 3-4 times a year. In order to do this they will put the items on sale to liquidate the inventory.
- Use your debit card. This way if you don’t have the money you can’t buy it!
- Set up a separate savings account. Set up to have $10 every week taken from your bank account and transferred to this savings account. Come the end of the year you will have $500 saved for the holidays! The best part – you won’t even notice that $10 missing every week but you will notice how great it will be to have that $500 to pay for Christmas.
- Use gift cards to stay on budget. If you set a budget of $50 a person, it is easy to spend over that limit due to taxes and extras. For example you find a great item that is $54.99, you think to yourself – that’s about $50. The problem is once you pay for it the total comes to $62.14! Now you are nearly 25% over budget. Another example is when you buy multiple gifts. You buy them a DVD – $19.99, a book $22.99, and a $10 Starbucks card. Add it up throw in the taxes and your total is… $58.57!
- Try buying gifts online. On eBay, Craigslist, Kijiji, you can find new and used items for a fraction of the cost. Books, CD’s, DVD’s, etc are especially abundant and inexpensive. Be sure to include any shipping costs and taxes in your calculation of cost to avoid spending more than your budget.
- Buy expensive items after Christmas. If you are buying an expensive item (electronics, furniture, appliances, etc), cut out a picture of it from a flyer or catalog and put it in a card to give to them Christmas day. Then go and buy it after christmas when the boxing week sales are on and save a bundle!
All this is can help to make your Christmas more affordable and reduce your debt and your stress. Let’s not forget what Christmas should really about, the festivities, the traditions, seeing old friends and family. Do you remember all the Christmas gifts you were given last year? Probably not, but you likely do remember the time you spent with family and friends. these are the gifts you will carry with you year-round.