That most wonderful time of the year (♪) is also considered to be the most costly for the average household due to the overwhelming cost of gifts, decorations, and food that is purchased.
Most families struggle to afford the holiday season, and only manage to get by with credit cards, loans, and overdrafts. Although it can be an important time of year to spend with family members and friends, the financial ramifications in the coming year can still linger and be difficult to repay.
To prevent yourself going into the red this Christmas, there are a few steps to take so that you only spend what you can afford.
Budget Your Gifts
The first step to take when planning for the Christmas holiday season is to make a list of Christmas gifts that you want to give. Write down a specific amount that you want to spend on each person and total the final amount to determine how much you’ll need to set aside.
Cut Out Some Luxuries in the Run-Up
Cutting out luxuries during the month of December as you pay for the gifts – although slightly painful to you – will help you afford the extra expense that you are undertaking. You don’t need to be going to expensive bars and eating out when you need the extra funds for gifts for loved ones. A little bit of self-control with yourself each day will really add up over the next few weeks.
Check Bank Fees and Overdrafts
To avoid spending more in bank fees with overdrafts, you can set up overdraft protection with the institution and agree on a specific limit to prevent penalties. You can also make it a rule to only use cash when purchasing the gifts, which will allow you to take out the amount that you’ve budgeted and keep it in an envelope.
0% Credit Cards
For those looking to pay later for their Christmas holiday, customers can apply for a credit card that offers zero per cent interest in the first year or longer. It is now easy to find an online credit card company that offers 0% interest and apply to take advantage of that deal. This will allow you to avoid paying hefty interest rates on your purchases while using a credit card for a convenient and efficient way to afford everything at once.
Deals and Discounts
Another way to prevent going into the red this Christmas is to take advantage of deals, discounts, and offers that are available during the holiday season. Many department stores have promotions during the month of December, as well as vouchers that they mail to customers.
Sign up for voucher websites to learn about the hottest deals and shop online for an easy way to compare prices. Take advantage of free posting, and earn rewards points where they are available.