While the holidays are the most wonderful time of the year, they also can be the most expensive.
Overspending for gifts, decorations, travel and food can run up credit card balances, but there are ways to avoid going into debt at the holidays.
“When people aren’t proactive, they overspend,” said Melissa Mast, a financial counselor with Spero Financial. “They’re in a rush, they’re staying up late at night on Amazon and just get carried away.”
Here are some tips from Spero Financial to help you shop smarter this holiday season:
Plan and save ahead
Decide how much money you should allow for holiday spending including gifts, food and travel. A good goal is about 1.5% of your annual income. For the average American family with roughly $50k annual income, that means you can spend close to $800 on your holiday celebrations. That’s $67/month into your holiday savings fund.
Make a list of everyone you want to give to
If you don’t make a comprehensive list, you underestimate how much money you need to save for holiday shopping, which can lead to stress, frustration, and possible debt. So, make a good list and decide about how much you want to spend on each of those people.
Anticipate parties, special meals, and visits to grandma
While you may not know exactly how many parties you (and your children) will be invited to, don’t forget to put together at least a ballpark budget for those parties. The budget could include food, wine, and party favors, just be sure to account for these items as part of your holiday spending.
Shop all year long
Keep a gift file open in your shopping brain all year long. Any time you are out and about and happen upon that perfect something for that perfect someone, buy it then and tuck it away in your closet or in a bin under your bed. Keep a record of gifts you purchase throughout the year and incorporate them into your shopping list and holiday budget, so you stay on track.
Keep a Goodie Drawer for last-minute, unexpected gifts
Have a drawer or shelf in your home designated for a last-minute gift supply. Keep a small inventory of common things many people use or enjoy such as nice candles, blank journals fun picture frames, specialties from local artisans like hand-thrown mugs, etc. This might feel impersonal, but it is far better than feeling empty handed with no time to shop—or the other extreme, shopping under pressure and then overspending.
Consider alternatives to spending money for gifts
What are your special gifts or talents? Do you knit or do woodworking? Maybe you’re a poet or a musician who can share words or music with those around you. If your holiday budget does not allow for you to spend what you were hoping for gifts, then give the gift of time, talent or deed and know you will be deeply appreciated.
Want to learn more?
Attend the Spero Financial Holiday Budget & Brews Financial Workshop on Tuesday, November 16, at 6:30 p.m. at Brewery 85, 6 Whitlee Court, Greenville SC 29607.
Go HERE to RSVP.
