This holiday season, the average household is expected to spend $684. While that’s a decrease of $51 from last year, it’s still a hefty expense for people to absorb during the weeks between Thanksgiving and Christmas. Since eating super-cheap PB&J for every meal isn’t really an option, you need to find some strategies to avoid sinking into holiday debt. Fortunately, we have several. (Consider it our early holiday gift to you.)
Create a Holiday Budget
We know, we know. It sounds so dutiful. But it’s essential to have an idea about how much money you can afford to spend on gifts, decorations, and entertaining. To start, take a look at last year’s holiday spending, noting both the amount you spent and what you spent it on. Next, make a list of all your anticipated expenses for this holiday season, including any tips, group gifts, travel, and charitable donations that you plan to make. Then, create a spending limit for each of these items and total up your expenses. Can you make room for this amount in your existing budget? If so, great, but if not, figure out where you can make realistic cuts to accommodate for these expenditures. Otherwise, you’re likely to find yourself in credit card debt come January.
Without a doubt, you want to get the best price on everything you purchase during the holidays — yet, there’s no way that you’re going to partake in any of that Black Friday craziness. While you might not be able to find those door buster deals post Thanksgiving, you can find the best deals out there by downloading price comparison apps, such as Smoopa, PriceGrabber, Amazon Price Check, Red Laser and Shop Savvy. And RetailMeNot and Cartwheel by Target are great coupon apps that enable you to save even more moolah.
Avoid Impulse Purchases
Whether it’s by offering samples, BOGO deals, gifts with purchase, playing holiday music to get you in the spirit, or placing tables and stands of stocking stuffers near the checkout, merchants are continually luring you into making unplanned buys. So how can you resist? In advance of any trip to the mall, make a shopping list and stick to it. To help avoid costly splurges, hit up the ATM before you head to the stores and only withdraw the amount you need.
Cash in Rewards
If you’ve earned a mountain of points, the holidays can be a great time to redeem them. Most credit-card issuers offer customers the ability to purchase gift cards to major retailers and merchandise (think: toys, electronics, luggage, beauty products, apparel) through an online marketplace on their website. Granted, the redemption value isn’t as good as if you cashed in your points through the affiliated rewards program (typically travel-related, like airfare or hotel reservations) — but isn’t it better to liquidate your rewards account and not your bank account?