Don’t Buy Christmas On Credit – Set a Christmas Budget

Did you go out and shop on Black Friday? Are you looking for the best deals all around on the must have gifts this holiday season? If so, then chances are you are a smart consumer and that you will save a lot of money on the presents that you purchase. However, it doesn’t make sense to put those purchases on a credit card and start racking up February debt, which will only reduce the amount of savings that you earned. In other words, if you put your Christmas on credit, and are like the 83% of the population who wont pay it back in one billing cycle, then your strife fighting the crowds and standing in line is all for not! In fact, you could just pay cash or debit for your purchases when the items weren’t on sale and probably make out better!

One of the things that makes the holiday season so difficult is that there is so much pressure for people to buy. And face it, you cannot afford to spend tons of money on idle shopping any other time of the year – so what makes you think you can do it at the end of the year? And only around 22% of the population starts an annual Christmas savings account, which financial analysts say is a great idea. The other 78% of us are trying to figure out how to pay Peter by robbing Paul and put those $200 designer jeans under the tree for our teenage daughter. It doesn’t help that every where you look, and every one you talk to is talking about spending money and buying gifts.

Truth! If you plan to put all of your Christmas shopping on a credit card, you will be ruining your blessings in the New Year. And you will likely be paying more for your purchases than you should when you add up all the interest and late fees. Plus, since you cannot see the future to be certain you are safe, you could be setting yourself up for a recipe for disaster should any type of financial crisis loom in the up and coming months. Not to mention the fact that come next Christmas, you might STILL be paying for those jeans.

So what should you do? You are like everyone else and you want to be able to put nice gifts under your holiday tree. You want the people in your life to be happy and content, and you want to see that sparkle in their eye when they open gifts. So how can you do it without going into debt?

Here are some tips that will help you not buy Christmas on credit as well as help you plan for Christmases in the future.

  • First and foremost, make a budget. If you have 3 or 4 kids, you need to come up with an amount of money that you are able to spend on each kid. Be reasonable about it as well, and keep in mind that most kids forget what they got for Christmas by the time Valentines Day comes around. (Right when the debt will hit you!)
  • Reevaluate your Christmas tradition. If a good Christmas is about getting and giving the ‘best’ gifts you are missing the mark and you are setting your family up to be disappointed. Instead, shift the focus from the gifts, to the togetherness and real meanings of the holiday.
  • Don’t be afraid to go handmade. Handmade gifts are often more heartfelt and are a much better idea than buying a bunch of ‘stuff’ to wrap for people in your life because you don’t know what to get them. Instead of going to Yankee Candle and spending $30 on a scented candle, make a dozen of them with your children to give away as gifts.
  • Make a list BEFORE you go shopping. During the holidays, retailers now that you will impulse buy. It’s hard to walk by all the special sales and promotional gifts without indulging in them. But you need to stick to your list with a vengeance and commit to NOT buying anything but what is on your list. This can save a lot of money in the long run.
  • Bring cash. Cash in hand makes you more conscious of what you buy, and helps you to stick to a budget. When the cash is gone –you are done shopping. In fact, leave all of your access to easy money such as debit cards and credit cards at home while you Christmas shop.
  • Make sure that children, even if they believe in Santa, understand that the sky is not the limit. One of the aspects that prompts people to overspend on credit during the holiday is the fact that they think kids wont understand why they didn’t get the exact toys that were on their list.

And, if you find yourself in this quandary every single year – then start a new tradition this year. Try to put money every paycheck in a Christmas savings account that cannot be accessed using your debit cards. This way, you will not feel the pressure and stress of the holidays next year. You should also think about giving a little less. Truth is that many of the presents you give are never used by the recipient and certainly aren’t truly appreciated. Is it really worth putting them on a credit card just to show up with a gift in hand? Experts say NO! And YOU should too!



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