How to Avoid Overspending This Holiday Season
While summer is barely over, the arrival of the fall season means the holidays are just around the bend. To avoid overspending and starting the new year off in debt, now is the perfect time to develop a spending and saving strategy for holiday shopping.
Make a List and a Budget
Take a page from Santa Claus’s book and make a list of everyone you want to buy a gift for this holiday season. After you’ve made that list, decide how much you’d like or are able to spend on family and friends this year, bearing in mind their tastes as well as your budget. While you might not know what you’re going to get everyone on your list, you at least have an idea of how much you need to save.
Don’t Use Credit Cards
To keep from receiving the gift of interest payments this year (and possibly even next year), do yourself a favor and don’t use your credit cards during holiday shopping; cash and not being in debit are king. In fact, you might want to think about getting a prepaid debit card and load it up with the cash from the budget you created from your list. Only use that prepaid card while you’re shopping, and once it’s empty, you’re done with your shopping for the year.
That being said, you might want to take advantage of rewards or buyer protections that come with credit cards. In these instances, you should make every effort to pay off that portion of your credit card debt before the end of the month you use it for holiday shopping so your reward doesn’t turn into a punishment in the form of interest payments.
Always Second-Guess Retail Sales
Before you perk up at seeing an item on sale, double-check to make sure you’re actually getting a good deal. Retailers do everything they can to part you with every penny you have, which means you have to be extra vigilant during the holiday season. Know that sometimes retailers markup the original price of an item and offer a “discount” that’s actually the item’s actual price. Shop around a bit to see if you can find anyone with an actual discount rather than the illusion of a discount.
Don’t Forget Your Regular Year-Round Financial Responsibilities
Just because you get some time off work during the holidays (hopefully) doesn’t mean your bills won’t stop coming in. What’s more is you might see some changes to some of your bills, such as your car or home insurance if your current policy runs out at the end of the year. Make some time to sit down with Washington DC local insurance agents to see if you need to make any changes to your policy or if there’s anything you can do to save on your policy. While you’re at it, reach out to your cell phone service provider to see if you can lower your bill. Anything you can save can go towards your holiday budget, or you can simply put it in your personal savings account. You’re sure to thank yourself when the new year rolls around.
Watch Out for Convenience Buys
During the holidays, you might run around more than you’re used to, which can turn into not cooking or eating like you usually do. Rather than spend money on takeout, delivery and coffee, plan ahead and prepare meals ahead of time that can be easily warmed up. Make coffee at home and pour it into a thermos so it stays warm longer. It might be easier to just order pizza or pick up fast food, but at what cost?
Put these tips to good use well before the beginning of the holiday season. Remember, a failure to plan is a plan to fail…and potentially a plan to unintentionally overspend.