The pressure may be on to create the perfect holiday season for your friends and family members, but this does not mean that you have to head into January swamped with guilt and debt. Instead, you can have a truly fantastic holiday season while keeping your spending to a minimum if you simply do a little planning. Although this may sound difficult and perhaps even a bit depressing, you will be glad you were wise with your money as you sit around the Christmas tree with your family with no feelings of stress, regret, or fear of your next credit card bill. Follow these three steps to avoid debt over the next couple of months.
1. Create a Holiday Budget
You absolutely must start with a budget. Whether or not you use a budget scrupulously throughout the rest of the year, a holiday spending budget is necessary for keeping your spending within the best limits for your family. In fact, you may be surprised to find out just how much freedom a budget gives you once it is in place. Rather than feeling scared of overspending every time you hit the mall or fill up your online cart, you will know exactly how much you can spend on each of your loved ones.
Part of creating this budget is first determining who is on your holiday shopping list and how much you want to spend on each person. Be sure to remember all of the little gifts that may crop up at the last minute, such as Secret Santas at work and extra tips for your hairstylist or child’s teacher. Be sure to leave yourself with some wiggle room so that you can easily afford taxes and shipping fees.
Of course, your budget will include more than gifts. It should also consist of spending categories for holiday parties, food, travel costs, new decorations, and anything else that is not a typical monthly expense.
2. Shop Smart
Once you have your budget in place, you are ready to begin your holiday shopping. It is easiest to start shopping as early as possible. Not only will this give you enough time to make the best choices for everyone on your list, but also this will help spread out your purchases so that you do not have to worry about spending all of your money at the same time. If anything is out of stock, you will still have plenty of time to find a replacement before the holiday arrives.
As you are shopping, avoid impulse purchases. Instead, stick with the plan you made, and steer away from buying yourself anything unplanned. Even a single impulse purchase can destroy your entire budget.
If you started holiday shopping early enough, you should have plenty of time to make online purchases so that they will still arrive before the holidays. Shopping online is a great way to save money because you will need to compare prices, look for coupons, and find the cheapest shipping rates.
Also, try to shop with cash, check, or a debit card that takes the money directly from your account. Try and avoid using your credit card. Even if you have promised yourself that you will pay off your holiday purchases on the first monthly statement, it can be too easy to blow off paying your credit card bill when January rolls around.
3. Find a Way to Make Some Extra Cash
Finally, if you realize that you do not have the cash you need to cover your entire holiday budget, you will have to find a way to trim the price tag or look for a way to make some extra cash. Thankfully, it is often easier to find a temporary job around the holidays than at any other time of the year because many stores and delivery companies are looking for new hires to cover the holiday rush. Some other good ways to make some quick cash could include offering to clean people’s homes before their holiday celebrations, making and selling homemade crafts, and selling unwanted belongings through an online marketplace.
These three tips will make it easier than you may have thought possible to avoid debt this holiday season. Set your family up for financial success in the next year by being thoughtful and creative in your gift-giving now. When you create a plan and stick to it, debt does not have to be a concern.