If you usually find yourself dealing with a stack of bills from holiday shopping, resolve this year to not let your spending get out of control. Is your budget already busted this season? Well it’s never too early to start planning for next year! By keeping a few key things in mind, you can avoid the added stress of spending more than you planned and concentrate on what’s really important during the holiday season – sharing time with family and friends and giving more of ourselves.
- Be Realistic: Before you can prepare for shopping, you need to first determine what you need (or would like to purchase). Plan your holiday budget based on what you can realistically afford. Take a look at your finances. Have you saved for holiday expenses? Or, will the gifts need to be purchased from regular monthly disposable income? Do you plan to pay cash? Or use credit? Include entertaining, travel, parties, decorations, gift wrapping, postage and any other holiday expenses. Consider discussing the plan with your family members.
- Make a Plan: Even Santa needs a list! Create a gift list of the friends, family and others you would like to remember with a gift and think of ideas for each listed person. Consider how much you will earn between now and the holidays. Decide how much you can afford to spend this season before placing a dollar amount by the name of each person on your list. In addition, create a separate list of items you may want/need that could be a part of holiday sales, such as appliances, household items and personal products.
- Do Your Homework: With gift and wish lists in hand, start looking for holiday circulars (Don’t forget online ads). Make an itinerary or timeline with store hours and times of special sales, and include store locations so that a streamlined route can be determined. If there's a deal for any of your listed items, write it down next to the item. Consider using folders to compile printed ads, circulars and coupons which will put your gift needs and sales within your fingertips.
- Avoid impulse purchases: Overspending is easy. Make a note of particular products, where you saw them and how much they cost. Advertising increases during the holiday season and stores offer expanded inventories. Be sure to shop with your list and consider paying in cash. If time permits, separate "shopping" trips from "spending" trips. Use shopping trips to get ideas, make a list of alternatives, check prices, and comparison shop.
- Use Cash, Not Credit: Leave your credit cards at home unless you know you need them for a specific purchase and you have a specific plan to repay the debt. Using cash, like three quarters of Americans say they do for most of their holiday purchases, can also help you avoid splurges, as well as costly fees or interest from debit cards, credit cards, layaway, or store financing. If you plan to do your holiday shopping with a credit card, consider using only one credit card and keeping a running tally of your expenditures. Keep track of purchases as you make them, can help you stay within your budget. Using multiple credit cards for holiday purchases makes it easy to lose track of holiday credit card purchases.
- Consider Online Shopping: Online shopping can be less time consuming and may help your holiday season seem less stressful. It is easier and faster to do some comparison shopping online and there are likely to be many coupons and shipping deals available. Online shopping can also help you avoid frantic, last minute binge shopping. Be certain you understand refund policies and don’t forget to include shipping charges in your budget.
- Avoid Pay Later Options: Research shows that buy now and pay later offers are designed to encourage you to spend money you don’t have. These plans usually charge high interest from the date of purchase if you can’t pay the bill in full by the end of the no-interest period, or if you are just one day late with a payment.
- Be Creative: There are several ways to give without spending a lot of money. Try giving the gift of service. Offer to babysit, run errands, shovel snow, iron, tutor a student or help with housekeeping.
- Share the Meaning: Teach your children the value of giving. Have them donate used toys and clothing to charity. You may also be able to take a tax deduction.
Low Cost Ways to Give
Having trouble buying gifts for every one of your friends and family members? Chances are they are, too. Consider different ways to make the holidays fun without breaking your budget.
- Holiday gift exchange: Draw names and only buy a gift for the person you choose.
- Make something special: Sometimes the best gifts are the ones you make yourself. Make personalized greeting cards, floral arrangements or even baked goods.
- Give a gift of service: Offer to provide a service, such as cleaning or cooking a meal, for a day, a month, or the year. Sometimes the greatest gift you can give to others is service. If you spend three hours a week reading to a child, that child is twice as likely to score in the top 25% in reading. If you work to secure food donations for a local soup kitchen or food bank, you are directly providing meals to hungry individuals. Sponsor or coordinate a homeless coat drive. Go caroling or read to seniors in an assisted living facility. Offer to babysit, run errands, shovel snow, iron, tutor or do housekeeping. What hobbies do you have? Can you use the skills and interests you have to create a memorable gift?
Sources: PR Newswire, Pew Social Trends Reports
