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Most of us look forward to this season because of the many festivities, exchanging of gifts and the overall camaraderie that it brings. However, there is one thing that we dread: the holiday spending.
In the past, we plunged blindly into the holidays, spending our money left and right while making excuses that it is all for the spirit of the season. Then, when the festivities are over, the good feeling quickly vanishes as we are faced with the statements that carried proof of our holiday debt.
Here’s the truth: it does not have to be that way. This is one of those times when shopping and saving becomes a real challenge but it is not impossible to stay away from overspending during this time of the year.
4 ways you can keep holiday expenses from putting you in debt
All it really takes to keep your holiday spending from ruining your post season mood is some preparation and planning. And it does not even involve new tricks. These are habits that we used to do and now it is time to use it specifically this season.
Be organized for the season. The first is simply to get yourself together and plan what you want to happen. Get your calendar and take note of the important activities that will happen in the next few weeks. Things like when is the company’s Christmas party and when your house guests are scheduled to arrive for the holidays (e.g. siblings, parents, etc). List what you need to prepare during these times so you are not caught unaware. Create your gift list and the grocery list for any food and house items that you have to buy. You should also take note of special dates like when your holiday vacation will start. Make sure you have given your gifts to colleagues before this date. All of these lists will help you keep tabs on all the activities and preparations that you have to accomplish. It will keep you from forgetting important purchases and hopefully avoid unexpected expenses.
Determine the costs involved and how you can afford it. When you have organized what needs to be bought, done and attended to, it is time to assess how much the holiday spending will cost you. Not only that, you have to know how you will fund all of it. Assess your finances and see where you can save to make room for the expenses that you have to meet during this time. Check if your credit card can offer rewards and other freebies. Take advantage of all of these if you can.
Make a budget. As soon as you have the list of expenses and you means to pay for them, it is time to organize everything in a budget. This is not too complicated because there are online budget templates that you can use to help make this plan. You can use the one from PracticalMoneySkills.com or you can download a template online. Allot a certain amount for each expense and make sure that you stick to it.
Choose how you can tighten your spending. With all of these information check how you can lower your spending to avoid putting yourself in debt because of the holidays. If there are gifts that you can do on your own, then that is what you should do. If there are expenses that you can forego, then you may want to think about cutting back to keep yourself from the need to use credit for some of your holiday spending.
These 4 tips should help you control the money that you will spend to make the holidays as enjoyable as possible.
Retailer efforts to make you spend more this holiday
The holiday season is a time where retailers will be trying to get the most out of shoppers. If you are trying to live on a budget to keep your spending down to a minimum, you have to learn how to practice smart spending. Given that, you need to be wary of the different techniques that retailers implement to encourage you to buy more than what you intended.
Here are some of what we have observed.
Reach a price mark and get a discount. Retailers love to offer discounts but only if the consumer reaches the required price. For instance, if you buy up to $150, you get 20% off on your purchase. This is a technique to get you to spend more than the planned purchases just so you can take advantage of the discount.
Putting great looking and expensive items beside sale racks. Another technique is putting expensive items right where the sale items are. Since people will automatically go to sale racks, putting other items that are usually better looking beside it will get the attention of consumers. Sometimes, it is placed in a way that you will think that it is part of the sale. When you reach the counter to pay, you will find out that it is not on sale after all. Going through the decision making process will make it more likely that you will go through the sale anyway.
Demonstrations. This is a proactive way for stores to get you to pay. Sale people doing the demonstration are trained to entice you to buy - even if you did not plan on buying it in the first place.
Product in the checkout area. As you are waiting for your turn to pay for the stuff that you got, have you ever noticed that there are a lot of items before you? These are small items that you really don’t need but standing next to them for quite some time will get your attention and entice you to buy them. This is one of those techniques used by retailers so be careful about them.
When you are out buying stuff, just make a list and stick to it. If there is something that you think you want to buy, give yourself time to think about it.