Overspending during the holidays can cost you more than you realize.
It can be tempting to go crazy the first Christmas after you get your first real job. You are making a real salary, and you feel that you want to say thanks to those who have helped you while you struggled through college and internships. But that doesn’t mean you should blow your budget in the process.
That’s why it’s important to have a Christmas survival guide to help you avoid common shopping mistakes and to prevent yourself from overspending.
1. Don’t Bust Your Budget
Before you buy a single Christmas present you should determine your spending budget this holiday season.
It goes beyond gifts. Many people forget to add in Christmas cards, office parties, white elephant gifts, and travel expenses. If you are planning a party you should add this into your list as well.
Then make a list of which you want to buy for and the amount you can afford to spend on the gifts. Once you add up all your projected costs, plus the estimated cost for gifts, then you’ll have your holiday spending budget.
It’s important to stick to your holiday budget. When you have used up all of your holiday money, it’s time to stop spending.
2. Don’t Use Credit
One common holiday shopping mistake is to put everything on the credit card. You can end up paying for your Christmas gifts for several months—or even years—if you make this mistake.
Keep in mind that people tend to overspend when they use credit cards compared to cash. Use your debit card or cash to purchase your Christmas gifts. If you plan carefully you do not need to use credit to buy anything associated with the holidays. This is one gift you should give yourself.
3. Don’t Buy to Impress
It is tempting when you finally have some money to go out and buy extravagant gifts for everyone on your list. You may want to buy an extra nice gift for your parents or a close friend, but try not to go overboard on gifts. Plus, most people would prefer a thoughtful gift rather than one that’s simply expensive.
4. Don’t Forget Anyone
One common holiday shopping mistake is to forget someone on your list. Shopping with a list is essential. For one, you do not want to forget anyone’s gift.
Additionally, as you make out your list you can write down gift ideas for each person. Take your list with you and consult it as you shop. Cross off each person as you find the perfect gift, so you don’t overbuy for one person and forget another.
5. Don’t Forget to Shop Around
You may hate shopping, or hate running from store to store trying to find the perfect gift. But another common shopping mistake is to forgo comparison shopping.
Comparing prices can save you big in the long run. At the very least look online at two or three stores, before you go shopping. This will give you an idea of how much an item should cost you.
You may also consider buying your gifts online, or taking advantage of Black Friday sales to save money, but only if you go in with a game plan and stick to your shopping list.
6. Don’t Wait Until the Last Minute
The worst gifts and worst prices are a result of waiting until the last minute to do your shopping.
There is nothing worse than the feeling of dread as you try to find a decent present for your family and friends in nearly empty aisles of a store, then spending way too much on an item because you have no other options. Avoid this holiday shopping mistake by shopping ahead. Bonus if you can get your shopping done before the holiday season begins.
7. Don’t Forget to Include Christmas in Your Budget
Many people’s biggest holiday financial mistake is to forget to spread the cost of Christmas over the entire year. You should set aside money each month to cover the cost of next Christmas.
Put the money into a Christmas savings account or simply earmark the money in your normal savings account. This allows you to purchase your Christmas gifts without overspending or worrying about how much you have to spend on gifts.
Source: The Balance