The holidays require a lot of planning, from wish lists, to shopping lists, baking lists, and more. But the very first thing you need to do is decide up front how much money you can afford to spend on the holidays this year. Let’s take a moment to consider some creative ways to curb your holiday spending and make the entire holiday season less stressful for you and your family. Unplanned purchases and impulse buys during the holidays aren’t always bad, as long as you keep your budget in check and try to save extras for last. But many people shop without a plan, making them vulnerable to holiday deals and sale signs that could get the best of them.

When you shop this season, follow these tips to avoid going overboard on holiday spending.

  1. Begin With a List of Holiday Expenses
    First, you should make a list of all the holiday expenses that you will have. This includes gifts that you need to buy, cards, wrapping paper, traveling expenses, gift exchanges at work and decorations. This will give you a basic idea of things that you will need covered. Many people only think about the gifts and wonder why money is so tight in December even if they saved up money for gifts.
  2. Set Limits for Total Holiday Spending
    Spend less money by using a Holiday Planning Worksheet to keep track of all the gifts you intend to buy or make, and record the amount of money you’ll spend on each person. This simple tool can help you stay within your spending budget and actually enjoy the months that follow the holidays.
  3. Avoid Buying Holiday Gifts on Credit
    Save money this holiday season by spending only what you have in your bank account. This means not using credit to purchase gifts! When you buy a R100 gift on credit, you’re basically telling the credit card company that you’ll pay them back that R100, plus another 20% or so in interest – each month – until the balance is paid off. That means that unless you’re able to pay off the balance of your credit card in full when the next bill arrives, you could still be paying for those R100 gifts months from now!
  4. Give Personalized Gifts Instead of Expensive Gifts
    A small, thoughtful gift is worth more than an expensive gift that someone may never use. Avoid impulses to shop at trendy department stores and start the holiday by taking a moment to think about what those on your list could really use. For example, if your sister loves to bake but can’t get the hang of homemade pie crusts, you could buy her a simple pastry-making tool and include a copy of a fool-proof recipe.
  5. Set Up Gift Exchanges
    Many people are struggling due to the economy, and may be relieved to rework the normal gift exchange within your family or your friends. Instead of giving gifts to everyone in your family, you can draw names or give family gifts instead of individual gifts. It does not hurt to ask if others are willing to make changes, and to set reasonable limits on the amount you should spend on the gifts.

Don’t let your debt become the Scrooge that steals the fun out of your holiday season. Spend time with your friends and family, base your gift buying on sentiment rather than dollar value and avoid giving yourself a year-round debt headache. If you can follow these tips, when your holiday bank statements arrive in the New Year, you’ll find yourself singing “Joy to the World” all over again.

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