It’s that time of year again – Black Friday, Cyber Monday, pre-holiday sales, post-holiday sales, last chance savings…. all designed to put you in the mood to spend. There are decorations to buy, food that you’ll need, and of course – gifts. According to one recent survey, the average American will spend over $900 on gifts this year. And nearly half of that may be spent on your kids. This is nice if you can afford it. But just because there is room on your credit card, that doesn’t necessarily mean you should spend it. So how do you make the holidays special without going over budget? Freedom Debt Relief offers these tips to keep from overspending this holiday season.
Create a Budget – And Stick to It
Before you hit all the fabulous shopping sales, determine our budget. If you are married, create this budget together so that you are both on the same page for your holiday budget. Freedom Debt Relief recommends that you factor in all the various holiday costs. In addition to gifts, there may be travel expenses, food, decorations, and even special events to take into account. Categorize your budget and decide how much you would like to spend in each area. If the numbers total more than what you can afford, look for areas where you can reduce your spending.
Can you spend the night at your relatives’ home instead of booking a nearby hotel? Could you wear the same shoes as last year to the holiday party? Or perhaps, cut back a little bit on gifts. While it is fun to be generous, you can have a nice Christmas without being extravagant, especially if it prevents you from accumulating more debt.
Set Expectations Early On
Once you have determined your budget, you may need to set expectations for your family – especially if you are cutting back from last year. For families with very young children, they probably won’t know the difference. And frankly, many times the new toys lose their luster after a few rounds of play. However, older children do remember, and may even keep count of the gifts (especially if they have siblings). So, speak to them about your plans. Be honest and tell them you are limiting the gifts this year. It may cause some initial disappointment, but in the long run, you are setting a good example for them.
In addition to a few gifts that your kids really want, you could also give them things that do not necessarily have a monetary value. Freedom Debt Relief suggests giving “coupons” that they can cash in sometime in the future. Some examples could be a “No Chores” pass, or “Movie Night” where your child chooses the movie. Not only do these things save money, they can also be used to bring your family together. And you can also do something similar with extended family – just let them know in advance your gif- giving plans.
Reduce the Convenience Costs
Despite setting a budget, hidden costs can creep up. One such one is the cost of convenience during the holidays. We get so busy running around tackling our holiday “to-do” list, that some other things can slip through the cracks – like dinner. How many times during the holiday season have you ordered pizza or had an impromptu dinner out because you were simply too tired to cook? How many Starbucks drinks have you guzzled to fuel you so that you could go on with your holiday errands? Yes, it is hard to come home after fighting traffic and crazy shoppers and make a meal for your family. And sometimes you really need a jolt of caffeine to keep you going. But be mindful of how much you spend on these things.
According to Freedom Debt Relief, a little advance planning can make all the difference. If you know that you are spending the day out shopping or running holiday errands, throw something in the crockpot for dinner before you head out. Or keep your freezer stocked with frozen pizzas and other quick and easy meals for those hectic nights. Also, to avoid the “Latte” factor, get a good night’s rest before you go shopping. And when you begin to feel tired, stop.
Be Mindful of Self-Gifting
Admit it, we’ve all done this – you are out shopping for the people on your list when you come across that “thing” that you just must have. And it is on sale! How can you pass it up? According to the National Retail Federation, about 60 percent of shoppers don’t pass on it…in fact, people spend around $130 on themselves this time of year.
So, while you should treat yourself to things sometimes, Freedom Debt Relief suggests that you always go back to your budget. Can you afford it? Will you have to use a credit card? Be mindful of this kind of spending over the holidays.
Track How Much You Spend – Regularly
Freedom Debt Relief recommends that you get into the habit of tracking your spending throughout the season. This is a great way to pull the “reigns” back on your inner Santa. Know in advance, before you head out the door, how much you can afford to spend. And when you get home, review your spending (and save your receipts). If you went overboard on your kids’ gifts, there is still time to return a few before the big day. Your kids will never know what they are missing.
Freedom Debt Relief Could Help You Get Back on Track
Being mindful of your spending this holiday season can definitely help your bottom line. But what if it feels a little too late? You may still be in debt and paying high credit card interest rates on last year’s holiday spending. If this is the case, Freedom Debt Relief could help. Our certified debt consultants have enrolled over 400,000 people, giving them a chance to get their lives back on track financially, and we could help you too. Visit us online for more information.
Andrew Housser, along with Brad Stroh, founded Freedom Financial Network in 2002. Today, Freedom Financial Network has over 1800 employees and has resolved over $7 Billion in cumulative debt.
Andrew earned his BA from Dartmouth College, where he graduated Summa Cum Laude. He went on to receive his MBA from Stanford School of Business.
Andrew is regularly called on and quoted by the media for his financial industry expertise. Some publications he’s been mentioned in include The New York Times, CNBC and The Wall Street Journal to name a few.