Before you start your holiday shopping, take time to plan your holiday budget. You want to stay clear of a Christmas debt hangover. Here are some easy ways to avoid spending too much this holiday season.
Set a Budget
Figure out how much you can afford to spend, and don’t go over it. Ensure you include gift wrap, postage, hostess gifts and travel costs. Once you have the amount, it is a good idea to add it to next year’s holiday budget to start saving ahead of time.
Make a List and Check it Twice
Enter the mall with a list, cross off each item as you buy it, then leave. Don’t get distracted by door-crasher deals and sales that do not cross items off your list. These items can add up fast.
Design your own holiday card using Canva and include a family photo and note about what’s happening in your life. You can email, text or share your card on social media. This will save you money on expensive Hallmark cards and postage.
Use a Credit Card Instead of a Debit Card
If you choose your credit card wisely, you’ll earn points on your purchases (which you can use for future gifts.) Often you also receive extended warranties and purchase protection. Debit cards offer none of these bonuses.
Pay Off the Credit Card Balance at The End of The Month
Set aside the money you budgeted, stick to your holiday budget, then use that money to pay off your balance. This way, you will avoid paying interest.
If you have high-interest credit card debt, a balance on your unsecured line of credit or other outstanding payments now might be the ideal time to refinance your existing mortgage and consolidate it all into one simple payment. Consolidation can sometimes reduce your monthly payments by more than a thousand dollars per month. If refinancing your home is an option you want to explore, contact me, and I would be happy to review your financial situation.
If you stick to these tips, you will set your bank account up for a Happy New Year!