With the increasing cost of goods and services, it's no wonder families across the nation go into debt during the holidays. However, with smart planning, you can avoid going into debt during the holidays while still making the most of the season. Follow these 6 tips to stay debt free this December.
Instead of writing out a gift list, write a detailed holiday budget. It should include all of your holiday spending, including food, outfits for parties, wrapping paper, and decorations, as well as who you're purchasing gifts for. Set a budget for all of your holiday spending, and stick to it. If you spend more on one item on your list, you'll need to cut back on another.
If your gift list includes lots of distant relatives or everyone in the office, consider trimming down your gift list to just a few close family members and friends. Feeling the pressure to buy for everyone is one of the leading causes of debt during the holidays, and you can avoid this pitfall by keeping your gift list as short as possible.
If you do have a large gift list, homemade gifts might be the perfect way to make sure everyone gets something without going over your budget. Holiday soaps, candles or even baked goods are inexpensive and take little more than time, effort and lots of love.
Instead of getting suckered into the sales at the mall, try shopping online ahead of time for your gifts. You'll need to allow plenty of time for shipping, however, you may be able to get the same thing you'd find in the store for significantly less online.
It may be tempting to put that gift that you just know so-and-so will love on a credit card, because it's over your budget but you really want to get it for them. However, it's critical that you avoid making any holiday purchases on credit. Your spending will quickly snowball, since it's much easier to get just this one more thing.
If you've already blown your budget this year, it's not too late to start planning for next year. Determine how much you spent this holiday season, and if you can, average it with the last few holiday seasons to get an accurate number of what you're likely to spend next season. If possible, get some of what you plan to buy next year after the 25th of this year, when stores have their Christmas decor, cards and wrapping paper at rock bottom prices. Set up a special holiday savings account, and put a little back each month or each week until you meet your goal.