How To Properly Budget For The Holidays
From Black Friday to Cyber Monday, the pressure to find the right gift for your loved ones and a great price begins. Setting a personal budget for the holidays and sticking to it will help reduce the holiday stress that most of us experience.
The National Retail Federation, an industry trade group, forecasts that sales in the last two months of this year should rise between 4.3 to 4.8 percent as compared to the holiday period in 2017.
Holiday shoppers are expected to spend between roughly $717 billion and $720.89 billion in sales this year. The sales increase also tops the 3.9% average annual uptick the industry has seen in the last five years.
Stress and the Holidays
According to the American Psychological Association (APA), the leading cause of stress during the holiday season derives from money problems. If you are like most consumers, you have not planned ahead and may find yourself struggling for cash come January. A proper budget for the holidays and smart shopping techniques will help you stay within budget while finding something special for everyone on your list.
Use these tips to budget for the holidays:
- Check your shopping list and make sure that everyone you are buying for needs a gift.
- Write down a maximum dollar amount that you want to spend for your entire list and then track how much you are actually spending.
- Buy items in bulk so you always have something little on hand for unexpected gifts.
- Take advantage of post-holiday sales on gifts for next year.
- Get a part-time job during the holidays, such as wrapping gifts at the local mall or being part of the Christmas display.
- Consider opening a holiday savings account.
- Be realistic about your purchases and ask yourself the following: Can I really afford this gift? Do I have the cash in my bank account to pay for it?
- When shopping, leave your credit cards at home. Then, if you do not have the cash to pay for it, you can’t buy the gift.
- Consider staying home and shopping online. Not only do many retailers waive shipping fees during the holidays, you’ll save money on gas by not having to visit the mall, too.
What to Know if You Use Your Credit Cards for Holiday Shopping
Tips for Those Who Want a Solid Credit Rating:
- Treat your credit cards like cash; deduct money from your checking account every time you make a purchase.
- Pay the entire balance of your credit card each month.
- Limit the usage of credits to two or three maximum and select cards with no annual fees, 30-day grace bill periods, rebate incentives or other incentives (airline miles, auto points, etc.) programs and single-cycle billing.
- Use your credit card with incentives for regular expenses such as groceries, utilities and gasoline.
- Conduct an assessment of your expenses quarterly and make adjustments to your spending if you are going over budget.
Additional Tips For Those Who Need A Little Credit Boost:
- Enroll in a pre-paid credit card program in which you load money onto the credit card for purchases. Once you’ve reached your set limit, the card will not work.
- Establish a budget that includes a debt repayment plan monthly. As you pay off balances, call the creditor and ask them to close your account so that you are not tempted to use the card again.
Your personal credit score is just as important as some of the other important numbers in your life. Financial institutions calculate your credit score, which determines what type of interest rate you will receive on a mortgage or credit card. Many other institutions are now using credit scores to calculate how high your health and auto insurance premiums will be as well.
Plan Ahead For Less Stress
Instead of worrying about these money-related problems, get your finances in order and spend time worrying about what color to frost your holiday cookies instead! Take the time to budget for the holidays to help remove the stress for your holiday shopping.
It’s The Thought That Counts
The holidays are not all about shopping, instead taking the time to make a thoughtful gift can make a lasting memory. With social sites, like Pinterest, you can find great ideas that your friends or family will love.
Some of my favorite gifts that I have received are Christmas Ornaments. Each year, when I put my Christmas decorations out, I think of the person that gave me the ornaments and smile. It’s the gift that keeps giving.
When you think of your budget for the holidays, remember it truly is the thought that counts.
GDI Insurance Agency, Inc. Your Trusted Insurance Broker
We hope that your holiday season is filled with love and great memories. Be sure to contact us if you do receive a gift of high value, as you will want to protect it with the proper insurance. Jewelry and high value items are not always fully covered with your homeowner insurance. 209-634-2929