Tips to Avoid Holiday Overspending

by David Sung

The holiday season is a time for giving and sharing gifts with friends and family.  As much as you want to celebrate and be merry during this festive season, you also want to avoid overspending.

This time of year, overspending is always a challenge people face. It is easy to get caught up in all the promotions and sales that entice shoppers to spend more money. Before you know it, several small purchases can easily accumulate into large amounts.

Here are tips to help you control your spending on gifts this holiday season:

  • Make a list of people who you want to buy gifts for this season. This list could consist of family, close friends, colleagues and more. Try to narrow down your list as much as possible.
  • Add a gift idea next to each person’s name on your first list. You may want to write a couple of ideas for each person in case the store is sold out or you need to make room in your budget for a more expensive gift.
  • Create a budget.  For each gift idea, write the estimated cost. Then, add up the total and calculate whether or not it can fit into your overall budget. If it doesn’t, then you may have to revise the amount of people or the amount of gifts.
  • Do your research.  Before you hit the stores, research the best prices online for the gifts you have chosen to buy. This will save you time when you dare to fight the crowd for a great deal.
  • Shop smart.  If you have done the correct research, this step should be easy. Know which stores have the best price for the item you are looking for and try to snatch it up before it sells out.
  • Compare the purchased amount against the actual budget. Subtract each gift amount from your total budget as you purchase each item. If you happen to spend less than expected on certain items, then you have more slack in purchasing other items.

Ruth Hayden, a financial educator, nailed it on the head when she said, “Consumers are seduced into buying.  To be seduced means that you are crossing boundaries that you have set.  You are tempted to buy because you want to belong.”

Just remember the majority of people have a hard enough time recalling what gifts they received last year  much less the previous year. Family traditions and memories are the details that truly stand out in remembrance of the holiday season. If you don't have room in your budget for buying gifts this year, you can always lend a helping hand to a friend or family member. For instance, help a friend by watching their pets as they travel for the holidays or help a family member with a home improvement project. It will give you a warm feeling inside when you help someone in need.

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