The holiday season is the shopping season, but for some people, it turns out to be the debt season. Millions of people worldwide shop in the festive period, and often, they end up in debt. In fact, 41 million Americans are still paying the holiday credit card debt from last year.
If you, too, have a long shopping list for this festive season but don’t want to get into debt, these tips will help you.
Create a Budget
First things first, be realistic about your budget. On average, US consumers spend over $800 on gifts in a festive season, but you don’t necessarily need to spend that much just because everyone else is doing it. Recognize your spending capacity and create a budget accordingly.
Now, adhere to that budget and avoid overspending. People often buy more than they should, only to regret it later. So, stick to your budget and try your best not to violate it.
Don’t Overuse Credit Cards
Credit cards have many benefits, but they are also one of the biggest culprits in overspending. Almost all credit card companies offer generous limits. And since you don’t need to pay the credit immediately, you may be tempted to use the full limit and exceed your budget. That’s why many Americans are still paying credit card debt from last year, as discussed.
Hence, be smart about credit cards. Don’t overuse your limit, and keep your budget in mind. Also, use credit cards that offer cashback and rewards.
Avoid Spending on Yourself
A lot of shoppers use the festive season as an opportunity to spend on themselves. They buy clothes, gadgets, home decor items, etc. If you want to avoid debt this festive season, hold off on self-purchases. If you must buy something for yourself, keep it for the last after buying gifts for everyone.
Do Research to Get the Best Deals
Almost all retailers — both online and offline — offer deals and discounts during the festive season. Find retailers offering exciting deals and shop from them in large amounts to get a better value for money. Also, look out for special offers like discounts on certain credit cards.
Here’s a pro tip: explore retailers offline. In this eCommerce era, people go to sites like Amazon and Etsy every time they need to buy something. Check out local stores in your area as well, and see if they offer any good deals.
Don’t Over Give
Lastly, don’t over give. Giving gifts to others symbolizes love, so don’t let it become your status symbol. Don’t be overly generous, and don’t try to compete with others. Keep your budget in mind and give gifts accordingly.
With the festival season around the corner, you are probably gearing up for an amazing shopping session. However, hold your horses and avoid spending too much. Understand your spending capacity and create a realistic budget based on that. Stick to that budget, use credit cards smartly, and search for the best deals to avoid getting into debt this festive period.