5 ways to avoid holiday debt!

By BankBazaar | January 28, 2015


I can’t put my finger on it but there is just something about the holidays that tempt us into buying stuff that we do not even need. Ok, granted that gifts are an important part of these festivities and you ought to share them with family and friends but on what cost? On overall financial health? As many money gurus say, a bargain deal is not that smart deal if it lands you in credit that you will be paying off in non-holiday season.

So is there any way to stay out of the shopping blues? Fortunately there are, all you need is a meticulous planning before the holidays start. Here are such means to help you save some bucks on your shopping this festive season.

1. Start saving long before the holidays

The funny thing is this one is so obvious and still people forget to do it. For most of the population, holidays are a one-time thing and they could be handled with just a weekend planning. If you too have been a victim of this thinking, no doubt you will be experiencing holes in your wallet and a bad credit history. The solution is to start making little savings here and there before the Christmas arrives; shop for gifts in advance whenever you see a good discount sale, and put a sum aside from your paycheck each month.

Savings every month especially for holiday funds will help you avoid the sudden burden of all that shopping in one go. Also make a budget on how much you want to spend on gifts, parties and holiday trips.

2. Make an elaborate spending plan

It means you sit down and put all the costs you will have to incur in your holiday plan; travel, lodging, food, partying, gift purchasing, etc. Be precise and practical while jotting down all the figures and take help from online travel portals and shopping websites if you want. Now look at the figure. Is it exceeding your budget? Then look at the ways you can cut it down. Perhaps you can stay at a less lavish hotel? Or you save money on air travel by taking a roadway? Be imaginative. And if you there is still time, may be you can save extra amount needed to make your holidays just as you want them. Consider all the options before you go your merry way to plan the party.

3. Plan it early

Booking your plane tickets just a fortnight before the big day is not only expensive but a serious financial do-not. Plan everything early; from booking your travel to purchasing of gifts. If you have done your shopping online, then do it early to avoid the fast shipping charges which could be enormous due to festive season. Likewise, if you want to gift your brother a tie and there is a good sale going on months before you will gift him; do not hesitate to grab the deal. Shopping a little early has not harmed anyone yet, has it? Especially if it means saving some precious cash. Do not wait for the season and by before the crowd claims it.

4. Use up your credit card rewards

This might be the right time to use those accumulated reward points you have been collecting for months. Check out the reward points and may be you will get surprised by the cuts in cost you can enjoy. If you have earned enough points then maybe you could change them to free flying miles? Many credit card providers offer discounts on shopping with some particular retailers, find out about them and shop only with those retailers, year round, to earn great points and discounts. In the same manner, various credit cards come with zero foreign transaction cost and if you are travelling abroad, it means you can save serious cash if you use that credit card. Read the fine print of your card carefully to assess the various offers.

5. Momentous gifts instead of expensive gifts

An expensive watch would not always make a grand gift than a scrapbook of life journey together could. Ask yourself, would you not appreciate some thoughtful gift that has been meant to touch your heart over an expensive one? This season, use your imagination to give gifts, you can collect coupons and gift them as a coupon bouquet to someone you know can use it for a more convenient life. Gift a book of their favorite author or cook their favorite dish while you watch a favorite movie together. Possibilities are endless.


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