It’s become so common for people to rack up huge amounts of debt during the holiday season, especially when they whip out the old credit card and throw caution to the wind! Between travel, parties, gifts, and décor, the amount you spend in December alone could result in an uncomfortably large credit card balance. Holiday finances can be tough to deal with.
You probably have fallen victim to it just as most of us have including me too as an impetuous youth. I lived to regret it and fortunately I learned my lesson and never did it again. So I ask this question of you now: Are you ready to plan right now to save your holiday finances?
Why This Year Is a Critical Moment in Time
I know it seems like it can’t be true, but the shopping season, kicked off by Black Friday sales and Thanksgiving, is just 37 days away! That means your course is going to be a crash course if you are participating and looking to score well and save your money.
2020 so far has really sucked, hasn’t it? I mean for most of us it’s been at best a really high-stress year and at worst the pandemic may have meant serious illness or worse for you and your family. That explains why looking forward to the holidays and the eventual end to this 2020 insanity year seems like such a big bright spot on the horizon. I am already chanting 2021, 2021, 2021 sitting here at my desk right now!
But even though we all want to move on so badly, reality is still reality despite any “alternative facts” you’d like to subscribe to.
Money and Jobs Are Not Out of Style
I hate reducing everything I say down to dollars and cents, but in a personal finance blog, it’s sort of a requirement, isn’t it? That’s why we have to talk about the elephant in the room and that’s jobs and money when it comes to planning and shopping for the holiday.
Let’s make our checklist here:
Do you still have a job? Is your emergency fund still intact? Are there issues that rank much higher than buying gifts like medical expenses, serious debt, or education costs? Do other family members depend on you for support right now like Mom and Dad or your daughter in Cleveland? There are dozens of questions to ask yourself and to prioritize, especially this year before you head off willy-nilly and shop. Perhaps this year is finally the year you simply must plan your holiday finances and do it right.
Normal Is Really Out the Window
Holiday debt is less than ideal at the best of times. But during the pandemic, it’s crucial to steer clear of debt. Even if you’re still earning the same paycheck, our economy is stuck in a recession. If you happen to lose your job in the near term, it could be months before you’re employed again.
The less debt you have, the more financially secure you’ll be as we approach 2021.
We can only hope a new year will bring a better turn of events and more prosperous times for all. If you at least plan well for this year’s holidays, there’s a good chance you’ll escape without a whopping credit card balance.
Chances are you’ll have to change some of your plans this holiday season. Maybe you won’t host your annual holiday party and you’ll have to take it easier on the gift-giving front. Either way, now’s the time to tally up your anticipated expenses and start socking funds away.
If you spent $600 on last year’s holiday season, cut it back as much as possible and try to get creative with your gift giving ideas. Now’s the time to realize that it is the thought that counts most simply because all of us can use some good thoughts a lot more than a new tie or whatever this years “mood ring”* gag gift is.
*Oh, look it up if you have no idea what I am talking about here!
Sensible Money Strategies
First, start saving your money right now. Save $200 a month for the next two months. That way you won’t be scrambling in December to pay any bills.
One good thing you probably have noticed is that the lifestyle changes imposed on you by the coronavirus crisis may actually be money savers. For example, if you’re working remotely, you could bank all of your commuting costs and even your dry cleaning bill for your business attire too. Seize the opportunity to take advantage of those savings well ahead of the holidays. That way you’ll be able to pay for your expenses up front and avoid taking on credit debt.
The old strategies from our past are still relevant. Tried and true things like comparison shopping, using coupons, loyalty cards, and always knowing price adjustment and return policies when you shop are guaranteed money savers.
But the big tip is this: Being an organized shopper will help you lower your costs this holiday season.
Many people wait until Black Friday to start buying gifts, but you may actually find that certain items are cheaper before the so-called peak sale season kicks off. Make a real list of the people you plan to shower with gifts now and jot down some ideas for each one. Then, search for those items online so you can compare prices and see if a deal pops up.
Here’s another trick: Some online retailers will actually lower the price of any item(s) stored in your shopping cart automatically. If they decrease before you complete your purchase, you get the savings! As you find gifts for the important people in your life, add them to your cart and then keep tabs on those carts to see if your totals or individual line items drop. When they do, then you’ll know the right moment to close the deal!
As online shopping is becoming more and more the go to way to shop, look for the free shipping promos and use them when you shop. That alone can save you a fortune! Remember, a bargain is only a bargain if and when someone actually uses and needs an item. Try to remember that when you are shopping this year for sure.
The U.S. economy is truly a mess and many people are struggling financially. As such, it’s imperative that you do your best to stay out of debt—even if your personal finances haven’t taken a hit thus far. Getting through the holidays debt-free will help you start 2021 on a financially healthy note. Perhaps it will set the stage for a new year of smart spending and increased savings.
Are you cutting back on gift giving this year to preserve your holiday finances? Have you a plan in place about how you will handle them and have you set limits? What kind of credit card debt are you facing right now?