With the holiday season in full swing, now’s the time to review your budget and set boundaries for the months to come. Putting in the work upfront can go a long way in helping you avoid financial errors that you’ll come to regret in the new year.
Overspending during the holiday season is one of the biggest concerns facing consumers. Even if you’ve avoided major trouble in the past, it’s a new year. And with that, you must have a plan in place for spending within your budget.
Here are three tips to prevent overspending this holiday season:
1. Set a budget
You should have a basic idea of the expenses you’ll face during the holiday season. This includes things such as gifts, entertainment, and travel.
Once you set a budget, implement a strategy for following it. For example, you could use a cash-based system to avoid overspending on a credit card.
2. Monitor credit card use
Overusing a credit card is one of the biggest risks of the holiday season. You spend, spend, and spend some more, assuming that you’ll come up with the money to pay off your balance when it’s due. But then something happens: you realize that you’ve gone too far.
Here’s an excerpt from a 2021 LendingTree survey:
The newest LendingTree survey found that more than a third of consumers (36%) incurred holiday debt this season, averaging $1,249.
And when it comes to consumer debt, credit cards are king. Protect yourself by monitoring your credit card use. If you find that you’re overspending, you can cut back before your situation gets worse.
3. Shop for deals
From gifts to airline tickets, set the goal of saving money on every purchase you make. This is easier today than ever before with the help of the internet. It only takes a couple of minutes (if not less) to compare prices and make an informed buying decision. This one simple change could save you hundreds or even thousands of dollars over the course of the holiday season.
What steps do you take to prevent overspending during the holidays? Would you add any tips to the three above?