The holidays are fast approaching. How do you make it a debt-free holiday season?
Halloween is next week. Hopefully, you are already using the tips we gave in an earlier blog article for an affordable Halloween celebration.
But the bigger holidays are still to come. For many, holiday preparations involve not only shopping but also travel. Altogether, during November and December, you can easily blow your budget. Putting all your expenses on credit cards, if you cannot afford to pay the balance in full, will leave you with credit card debt that could easily last until the 2020 holiday season.
Ending the year in debt is not the way you want to start the new year.
Tips for a Debt-Free Holiday Season
Tip # 1.Start Now
Procrastination will cost you money later. The first tip for having a debt-free holiday season is to start planning now.
Tip #2. Budget
Budgeting is key to financial success. Without a budget, you have no idea what you can afford and cannot. If you haven’t looked at it recently, now is a good time to look at the budget you prepared at the beginning of the year. This is also a good time to do an assessment. Were your projections realistic?
Did you allocate for holiday spending? How much did you save?
If you didn’t include the holidays within your 2019 budget, then make a holiday budget now.
- Everything else you need for the holidays.
Tip #3. Create your gift list
How much do you want (or can you afford) to spend for each person on your gift list? One great way to have a debt-free holiday season is to minimize the number of gifts exchanged among family members. Draw names instead. Each person only has to give one gift. Do you have kids? How much will you spend on gifts for the kids?
Now, let’s return to your savings. Did you save an amount equal to your holiday budget? Can you pay off the balance in full, if you put the deficit on your credit cards? If not, then the amount you have saved…that’s what you have to spend on the holidays.
Tip #4. Don’t wait until the holidays to do your shopping
This may not help you much now, but one way to have a debt-free holiday season is to buy items throughout the year. For instance, decorations go on sale immediately after the holidays are over. You can grab stuff at clearance prices and save a lot of money. Buy the gifts you want to give for the holidays throughout the year, whenever you see the items on sale. Keep track of what you have purchased and how much you have spent. Store everything in a safe place. You will have less shopping to do in November and December and save money.
Even if you didn’t start earlier in the year, you can still save money and stress by starting your shopping now. You don’t have to wait for Black Friday. You might snag some good deals on Black Friday, but the stress of long lines and crowds may not make it worth it. Pace yourself, look for quieter times and remember that retailers are already marking products down. Less chaotic situations will also give you the mental freedom to think about what you are doing. You can be more creative and sure of buying what you really want to give.
Tip #5. Shop Smart
Shopping smart is something you should be doing year-round. It is an especially important part of your strategy for a debt-free holiday season. You will be bombarded with Black Friday and Cyber Monday deals, but don’t rely on those. Use shopping apps such as Honey and RetailMeNot to find coupons, promo codes and other ways to save money on your online purchases.
Don’t forget to sign up for emails from your favorite retailers, and/or join their social media channels. You’ll be the first to know about special deals.
Tip #6. It’s the Thought That Counts
This may sound like a worn-out adage, but it’s true. You don’t have to spend a fortune on gifts. In fact, you don’t have to buy presents. If you have special talents, use those to create unique, special and individualized presents. Sometimes the gift of time is enough, especially for parents and grandparents. Gift a service that you provide. And even if you do purchase gifts, the price tag does not always equate to quality.
Tip #7. Save Money on Travel
Holiday travel, especially if you have kids, could eat up a big chunk of your holiday budget. This is where you need to be crafty to find cheap holiday travel options.
Take advantage of travel sites to help you find the best deals. Kayak, Trivago, and Priceline are some examples. Google Flights tracks prices and advises you when it’s a good time to purchase. The bottom line is to shop around. After you think you’ve found the best price, contact the airline directly. Sometimes they have a better deal.
If you’re going to join the 50+ million Americans on the road this holiday season, you also need a cheap travel strategy. Save money on gas by using apps such as GasBuddy. If you are traveling with kids, be sure to stock up the car with beverages and their favorite snacks. If you have to buy these things at the gas station or roadside convenience store, you will use up most of your budget.
Tip #8. Leave the Credit Cards at Home
If you want to have a debt-free holiday season, leave the credit cards at home and shop with cash. Keep your list and gift budget in front of you and stick to it. When you have only cash, there is less opportunity for impulse buying. How many times do we buy stuff for ourselves when we’re out holiday shopping? Did we really need that stuff?
If you are shopping online, use your credit card rather than a debit card. The holiday season creates a fertile environment for cybercriminals. You will be more protected with a credit card. Also, you can benefit from rewards and cash-back promotions.