By Daniel Rodriguez | Dr. Budgets
Happy December! I hope you had a great Thanksgiving Weekend! If you are like most Americans, you probably did some shopping over the weekend, and you probably did some online shopping yesterday. But December doesn’t need to mean holiday debt! This month I want to share a few tips that can help you stay out of holiday debt.
1) Create a holiday gift budget (and stick to it). First you should determine how much money you want to spend on gifts in total this holiday season. Don’t forget to account for many of the often-overlooked details as you can – shipping costs, wrapping paper, stamps, and hostess gifts all add up! After that, create a list of everyone you plan on buying a gift for, and then calculate how much you are going to spend on each person. If you end up spending less for someone on your list, then put that money toward your goals rather than going out and spending it.
2) Avoid using credit cards. One surefire way to stay out of holiday debt is to not use your credit cards. Your gift budget should not exceed the amount of money you have, so you shouldn’t need your credit cards. If you have gotten yourself into holiday debt in the past, then leave the credit card at home to force yourself to stick to your budget.
3) Agree ahead of time. Be purposeful about your gift-giving by agreeing with your loved ones on a gift limit, or even no gifts at all if it makes sense. If you agree ahead of time to limit the dollar amount of the gifts, then you will have set expectations and boundaries with each other, which will make it much easier to stay within your budget. If you have a large family or a close group of friends, you could decide on a white elephant gift exchange to limit your spending on gifts (and have fun at the same time!).
4) Creative gifts. Does everyone love your spaghetti sauce? You can give jars to family and friends, offer to make a spaghetti dinner for a night in, or print out recipe cards and gift them with all the spices – the possibilities are endless! Turn to Pinterest for inspired packaging or Christmas present ideas and get creative this year! If you’re not the crafty type (like me), you can always get creative with a $10 or $20 per person spending limit. One of my favorite gifts ever was an Aztec Basketball t-shirt (about $20), proving it doesn’t have to cost a lot to be meaningful.
5) Remember what is most important. Ask yourself: Would my family and friends want me to go into holiday debt on gifts for them? This time of year, there is so much that is more important than giving gifts – especially if it means that you’ll be paying for them until next Christmas! Slow down and try to soak in what really matters.
BONUS TIP: Save on electricity. This last one is not gift-related at all, but can save you money for many holiday seasons to come! The holidays create a lot of lights, and those lights use electricity. You can save money in the long run by using LED lights instead of incandescent lights. LED lights use about 80-90% less energy than incandescent lights, but often cost 10 times as much to buy, so replacing them all can be very expensive. A simple way to save money is to put your holiday lights on a timer. Electricity can be expensive, so a timer is well worth the investment.
So, those are my 5 tips to help you stay out of holiday debt. If you have any tips, please share them in the comments section below. I hope you had a wonderful Thanksgiving, and I wish you a very happy holiday season! If you want more tips please visit our Facebook or Twitter page where we’ll be featuring our favorite tips and articles this month. Also, if you’d like help with your budget so that you can save for presents throughout the year contact us today to set up your complementary consultation!