According to the National Retail Federation, consumers plan to spend an average of $997 this holiday season. While not everyone relies on credit, 61% of consumers who carry credit card debt are prepared to add to their deficit (mostly to please a loved one), according to a poll by CreditCards.com.
This year, block the noise, and do what your heart says is best for you. With a little planning, smart shopping, and creative ways to earn more, you can start the year feeling more confident and happier about what’s to come.
Avoid piling on additional debt with these simple tips.
Talk to your loved ones.
Traditions can be expensive especially as families grow. This year, consider having a heart-to-heart with your loved ones; be open and honest about how you feel. Each household may be spending hundreds of dollars each year simply to please one another or because it’s what you’ve always done. Talking openly about your hopes for the holidays may bring relief to all.
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Reduce gift spending.
The bulk of spending during the holidays is on gifts for family. Rather than giving each family member a gift, try something different. Coordinate a white elephant gift exchange or draw names for a Secret Santa approach. This change alone can bring big relief to your budget.
Redeem those points.
There may be money lying around in a few places and every little bit helps. If your credit card offers rewards, now’s the time to redeem points.
Additionally, if your employer has a wellness program or employee engagement platform, redeem points on those too.
Get a seasonal job.
If you are committed to spending more that you can currently afford, consider boosting your income. Turn a hobby into a money stream or apply for a seasonal job. You’ll have extra income and may have access to an employee discount as an added perk. It’s a win-win.
If you must borrow, choose wisely.
Set on borrowing? Look over your options. If you’re going to pay the balance in full when the statement arrives, use a card that earns cashback or points. If you’re planning to carry a balance, it’s best to go with the option that offers the lowest interest rate. This could be a credit card with a low introductory rate or even a holiday loan.
Sell duplicate items.
What do you do when you receive something you already have? Maybe your sister thought you could use a Crockpot or perhaps your brother bought you a new Blu-ray player. If you already have the item, you can try selling your old one for cash or getting store credit for the new one.
Begin saving for next year.
To reduce our dependency on borrowing, it’s best to anticipate the added expenses. Keep your receipts and track your expenses this holiday season. Take the total amount spent and divide by 10 to see what you should save from January to October of next year. For example, if you spend $800 this year, you’ll contribute at least $80 a month to your holiday fund for 10 months to prepare.
Visit aplusfcu.org/balance to gain access to free resources covering a wide variety of financial topics, including tips for surviving the holidays.