Thursday, Nov. 21, 2019 | 2 a.m.
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'Tis the season for spending—and likely too much. When the rush surrounding gifts, travel, parties and more begins to settle, many people find themselves overstretched. "It's common to overspend during the holidays, but thoughtful strategies and methods to curb missteps can alleviate a lot of the stress," said Nicole Cypers, Vice President of Public Relations at America First Credit Union. Before you start racking up charges on your credit card, consider these tips.
Make a list
Start by planning for all holiday-related expenses. "Gifts are typically the most significant cost, so that's a good place to begin. List all the presents you intend to purchase and set a budget for each person," Cypers said. "Once you're satisfied, note other items you'll pay for, including travel, entertainment, charitable donations—even wrapping paper and cards. Be sure to remember that the little things add up."
... And check it twice
If projected expenses are out of your comfort zone, look for opportunities to cut back. "There can be significant financial pressure during the holidays and folks may feel inclined to spend more than they should. It's best to have a plan that helps you avoid this temptation," Cypers said. Paring down expenses can include downsizing your list or using smart-shopping techniques—holiday sales, coupons, comparing prices and rebates can all help save.
Don't forget what really matters
The holidays are about more than consumer goods. From handmade gifts to experiences with your loved ones, there are many ways to give that don't cost a dime. "Rather than focus on spending money, spend time with the people who matter most to you," added Cypers.
Plan for next year
It's never too early to start saving. Once you wrap up all holiday spending, start planning for next year's season. "If you tend to struggle financially during this time of year, setting up a dedicated savings account is a great way to prepare in advance. Knowing you have these resources can give you peace of mind as next winter approaches," Cypers said.
Other spending tips
Avoid last-minute shopping: Impulse buys are tempting and that feeling is magnified during the holiday season. Stick to your gift list and avoid unnecessary purchases.
Strategize when to use your credit card: If you're concerned about overspending, pay with cash as much as possible. Use a credit card if it benefits you—a cash-back option or rewards—but remember to pay off your balance quickly.
Put money aside for the unexpected: If possible, leave room for miscellaneous items. Having funds for unexpected expenses, such as your office gift exchange or a last-minute party outfit, can ease stress.
Track your spending: Reference your list while shopping and note the per-item cost. Similarly, make note of holiday-related spending. Keep the list on your phone for easy access while you're out and about. A running tally provides an accurate real-time look at costs and it will help you when determining next year's budget too.
Start saving: Even if you haven't set aside money earlier, you can start saving now to offset costs. Simple techniques, such as packing your lunch or skipping your morning coffee, will add up come December.
