Avoid the post holiday blues by learning tips and tricks to reign in your holiday spending.
Ah, the holiday season! Turkey and dressing, pumpkin pie, office
parties, jingle bells, and lots and lots of eggnog make the season a
delight. But all fun and reindeer games aside, you have to be careful
to make sure you don't wind up as poor as Tiny Tim! Americans can spend
as much as $1,000 a year on gifts for family, friends and business
associates. That is a big chunk of money that can hit you pretty hard
come January if you don't plan ahead. There are some tips and tricks
you can do to keep your holidays bright and debt-free this year.
Before the holidays arrive, do some careful plotting and planning for
family and business expenses. A few hours spent in preparation can mean
less money spent on gifts. You don't have to be Scrooge, you just have
to be smart.
1) Decide how much you are willing to spend, and stick to it. Pretend
you are spending cash. How much can you afford out of pocket this
month? If you cannot afford it right now, consider that you cannot
afford it at all.
2) Budget non-gift and after-Christmas items too. Remember to include
other things you buy over the holidays - cards, stamps, candles, a
tree, decorations, and food galore. Plus, plan ahead to save some money
for next year by taking advantage of after Christmas sales. It is all
part of your holiday spending, so plan for it in your holiday budget.
3) Make a list of everyone you will be buying gifts for and estimate
how much you want to spend on each person. Include the smaller gifts
for teachers or your mailman. Include the price of cards and stamps,
because Christmas cards count as gifts when it comes to your budget.
Then, add it up and compare the total to your budgeted amount. Make the
necessary adjustments. Your brother-in-law may only get socks this year.
4) Cut down your list. This may sound harsh, but look closely at who
you are buying gifts for. When saving money is an issue, it is ok not
to give gifts to everyone you know. Send only cards to distant
relatives, neighbors you don't know well and business owners who
haven't bought from you this year.
5) Be creative. Determine if some people would be happy to receive home
baked cookies. Remember, the holidays aren't about presents but about
good will towards man. Good will comes in many forms and does not
always need wrapping paper. If you have a skill or a hobby, use it:
needlework, knitting, art or poems. Make a photo album, or offer to
plant their garden. Use discount coupons for your customers.
6) Carry your shopping list with you. Take every opportunity to shop.
Start early and try to get things before the rush, before highly
sought, hard-to-find items go up in price, and before you can't find
what you need. This gives you a chance to comparison shop. It also
takes away some of the stress and reduces your risk of overspending
just for the sake of finishing your shopping.
7) If a store offers free gift-wrap, go for it! It'll save you time and
money on buying wrapping paper, tape, bows, and cards and struggling
with it all yourself.
8) Have willpower. Stick to your estimates and you won't go over
budget. eBay is a wonderful shopping tool if you remember to start
early enough to account for shipping time. Find the right item, bid
your budget price and leave it. If someone outbids you, don't get into
a bidding war, just bid on something else within your price range.
9) Increase your income for the season. During the holidays there are
lots of ways to make a little extra money. Many stores hire part-time
workers for the holidays. Since it is a party season, babysitting is in
high demand. Be imaginative. You could be the Official Gift Wrapper in
your neighborhood and wrap gifts for friends and neighbors for a small
fee.
10) Use your credit cards. Yes! If you stick to your budget and only
spend what you are able to pay for in the next 30 days, then yes, you
CAN use credit cards. The key is to use them as you would cash. Using
your credit card is not a way to buy things you can't afford, it is a
way to organize your spending and possibly get some rewards and
discounts along the way.
11) Make the credit card companies compete for your business. It may be
the holidays, but you can dig in your heels and play hardball. Call
your credit card bank and tell them you won't be using their card for
your holiday purchases unless they sweeten it up for you. You want a
little sugar and spice to make using that card a better deal. You can
ask for 0% interest, double your gas points or flyer miles. Anything to
make using your credit card more worthwhile. Banks will usually be
willing to strike a deal with you, so long as you try. It can't hurt to
ask.
12) Use specialized credit cards, but carefully. Many of the stores
where you will be buying your holiday gifts offer their own credit
cards. They tend to have ridiculously high interest rates. However,
they may give you discounts of 10%, 15%, sometimes even 20%! So, you
could actually go ahead and use a store credit card to make the
purchases and get the discounts, since you are paying these off when
the bill comes due the interest rates should not be a problem. If you
do get into a pinch and can't pay them off right away, then transfer
your balance to your lower-rate credit card before any interest is
added to the higher-rate one. You need to be on the ball with this
trick, but it may save you money.
It is important to keep in mind that every new credit card you apply
for will lower your credit score. So if you're saving up for a mortgage
or a large loan, you'll want to avoid applying for additional credit.
Come the start of January, your main concern is going to be getting
ready for the new year, and you won't want post-holiday money troubles
making things worse. The Ghost of Christmas Past starts visiting even
before you put the tree in the trash. Be sure to have a Happy New Year
by being money-wise in advance.
(c) 2005 DebtGuru.com(r). This article may be freely distributed as long as the signature file and active link are included.
