With the holidays approaching, you are likely gearing up to mingle with the masses for your holiday shopping. Before you start shopping, we have a few tips to keep in mind, so you don’t break the budget. Here’s how to avoid overwhelming credit card debt in January.
Create a Gift Giving Budget
The most important tip is to create a budget. Brianna Kane, one of Coulee Bank’s Business Banking Assistants, recommends looking at your current expenses to determine what you have left over to spend on holiday gifts. Once you know how much you have on hand, you can determine what if any you want to charge on your credit card. Use your budget as a guide to help you stay on track.
She says it’s important to remember the forgotten expenses as you set your budget. Remember, you may have holiday parties for work or with friends that require new apparel, shoes, accessories, meals, and beverages. Travel expenses need to be factored in as well. If you are taking a road trip, consider the cost of fuel and meals. If you are flying, consider airline tickets, rental cars, hotels, and meals.
Create a List of Gift Recipients
To start, Kane recommends making a list of people you plan to give gifts to and set a limit for each person. If you have a large family or have a lot of people in one group to buy for, suggest Secret Santa gifts or white elephant gifts to keep the cost down. Kane says, “More than likely, people will be on board. Then the group members can purchase gifts and choose their own budget without it affecting yours.”
Once you have a list of all the people you want to buy for, set a budget for each person. Even though you have determined the dollar amount, you can allow for flexibility. If you discover gifts that are under budget for someone, you can add a few extra dollars to someone else’s gift or save it for the credit card bill in January.
Kane urges you to stick to the list. “If I walk into Target without a list, my cart is full, and I usually have a spending hangover. If you walk into the store organized with your list in hand or on your phone, it helps you keep track of each person, and the dollar amount you are spending.”
Create Handmade Gifts to Keep Costs Down
Creating handmade gifts is Kane’s favorite part about the holidays. She says, “Handmade gifts are often the best ones, especially for family members. We love to plan a big crafting day and watch holiday movies and drink hot cocoa!” She says not only are you creating special gifts for loved ones, but you are creating memories with your kids or other family members. “This year, I am using mason jars and filling them with dry ingredients needed to make cookies along with my family recipe attached.” The recipient needs a few ingredients usually found in the kitchen to make the recipe. She says sharing something personal can really make people feel special again, and it’s a money saver.
Create Lasting Memories Rather Than Buying Expensive Gifts
“This is my favorite approach to gift buying, especially having younger kids. People gift children with lots of ‘stuff’ but sometimes it’s forgotten in a few weeks and just takes up space.” Kane and her family ask for experiences. Every year, her in-laws gift them with an annual family pass to the Minnesota Zoo. She says they visit the zoo as often as they want and there is always something fun and new to experience.
“Last year, my husband and I gifted our kids an annual pass to the Crayola Experience at the Mall of America. To ensure they had a gift to open, we wrapped some arts and crafts supplies.” If you plan to experience these activities anyway, the passes usually pay for themselves after two visits.
While it is fun to splurge on your friends and family each year, the extra spending can create a lot of stress in January. Use these tips to continue to spread holiday cheer without breaking the bank.