Do Not Get Caught Up In Holiday Spending
It is easy to get caught up in the moment when shopping for Christmas. For days now, the television news networks have been talking about Black Friday deals, and websites have been giving customers a sneak peak of the sale flyers. It is almost like getting wrapped up in the excitement of an auction or buying things off of late night television infomercials. There’s a feeling of missing out if you don’t get the best deals. Black Friday has the same feel, but like an alcoholic, acknowledging it is the first step. Don’t give into the frenzy.
Credit cards are an easy way to pay for your Christmas and other holiday gifts, but they should be used with a bit of caution and pragmatism. There are some great tips that can help you keep your holiday gift giving and spending in check this Christmas season. Credit cards do not have to be the only way to pay for your holiday gifts this year. There are many other ways and techniques that you can use to keep your finances in check. .
1. Buy a few gifts each week. Instead of waiting until the last moment to do your Christmas shopping, space out your purchases over the weeks leading up to the big day. Then you won’t end up with a long list of things to purchase in a short amount of time, forcing you into quick, irrational buying. If you start early, you can take your time, shop during sales and pay off purchases before they start to accumulate. Moreover, you may be able to spread out your credit card bills from your holiday shopping over more than one month, making the total easier to pay off.
2. Treat credit cards like cash. Don’t spend more on your credit cards than you can afford to pay back by the end of one payment cycle. Pay your balance before any interest has time to accrue, so you still get the benefit of being able to buy something before you’ll have the money to cover it without also having to pay interest.
3. Set a spending limit. Cap your gift-giving budget to an amount that’s affordable for you. Most people plan to set some sort of shopping budget, as 68% of those surveyed do, but not everyone factors in the other irregular expenses that creep up during the holidays and that last well into the new year. Give yourself some wiggle room by looking at other areas in your overall budget where you can cut back. Maybe you can dine out less or reduce how much you spend on leisure for the next couple of months.
4. Be realistic about what you can give. Sometimes you just have to be honest with yourself about what’s doable and what’s not. You may want to give lots of gifts this year, but there are other ways to give if you don’t really have the money to buy them all. Come up with thoughtful gift ideas that keep you from spending too much but still let others know you care. An expensive gift isn’t the only way to show your kindness.
5. Take advantage of cash back rewards programs. If you’re going to use a credit card to do your Christmas shopping, use one that has a rewards program. That way you’ll earn points for your spending that could be used toward a gift for yourself in 2014 – a reward for acting within your limits during the holidays.