How to steer clear of holiday debt

The holiday season is here with us and that means more and more spending. A research study done in 2013 showed each citizen in the UK spent an average of £680 on holiday shopping including gifts and food. However, you don’t have to throw yourself into a debt hangover once the New Year kicks in. Despite the temptation of overusing your credit card, you can still spend smart and use your hard earned money well. All you need is to be vigilant and to have a plan. If you want to have a great holiday and still have money to pay bills in the following year, then follow these simple ideas outlined here.

Leave your credit cards at home

During this holiday, using your credit card to go shopping could win you some discounts and promotions. However, you can easily fall into the trap of purchasing things you do not need since you won’t really feel the pinch of paying cash. That’s why it’s important that you leave that magic plastic at home this holiday season. Only buy what you can afford when paying upfront, and doing so will go a long way in helping you stick to your budget.

Additionally, avoid signing up for easy pay instalment plans. Remember, even though these plans look like an easy solution for purchasing that expensive jewellery you had your eyes on, you will still pay for it through your credit card over the next few months, probably paying more than you should, and putting yourself into unnecessary debts as you start your new year.

Be creative

Holidays are typically meant for having fun and sharing of gifts and meals with family and friends. With all the merry making you can easily find yourself spending moiré than you intended shopping for gifts. If you want to stick to a reasonable budget this season, then get creative. Make your own gifts or give out that pretty dress you outgrew, and accompany with gift cards. Alternatively, give out experience instead of stuff. Take your family and friends for a hike or walk and enjoy skating on the snow together. After all, memories stay longer in our hearts and minds than material gifts that can easily wear out or get lost.

Follow your spending closely throughout the holiday

You need to keep yourself in check this holiday by tracking your spending. Do this by first coming up with a sum total of the amount you will spend the entire season. Then create a budget which you will need to use whenever you want to buy anything so as to avoid impulsive buying or overspending. You could also create an allowance for extra spending as you tabulate the budget. Alternatively, get an app that will keep track of all your spending and give you a rough idea of how much you have spent so far and how much more you still have to spend. It is important that you maximize on offers and discounts as is the norm of the holiday, so subscribe to discount SMS alerts on your phone. If you do this, rather than having debts to pay, you will have some saving left. And what better way to celebrate Christmas than this!

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