Worried About Racking Up Deep Holiday Debt? Do This

How do many people end the holidays? Overweight from all of that delicious food, and broke from excessive spending.

Some experts believe this holiday season will be different, though, due to the coronavirus pandemic. It’s no secret that the global outbreak has put many in a tailspin, especially when it comes to money.

If COVID-19 has negatively impacted you through job or income loss, here are some tips to follow to avoid deep debt that’s often linked to too much holiday spending.

Stick To Cash

What happens when you use cash to pay for something? Your wallet becomes lighter and emptier, and a feeling of loss can appear.

On the flip side, paying with a credit card usually doesn’t carry those symptoms. Your wallet stays the same, and nothing “physical” disappears from your possession.

Of course, a feeling of loss can occur when you receive that credit card bill in the mail, which is why it’s best to stick to cash for holiday purchases.

With cash, you don’t get a false sense of security. You know that once it’s handed over to the cashier, it’s gone for good, and this can help keep your spending under control.

How much cash should you use? That depends on your holiday budget, which you should create before spending a single penny on any gifts, decorations, etc. With your budget established, you can withdraw your holiday cash as a reminder that once you spend it, the shopping season is officially over.

How do you use cash for online purchases? Get a prepaid card. Whatever currency you put on it is your limit, which makes it much better than regular credit cards for year-end financial discipline.

Be Prepared

An easy way to rack up loads of holiday debt in a little time is to wait until the last minute to shop. Retailers know that last-minute shoppers need their products, which makes them less likely to discount them. And not only can procrastination cause you to miss out on the best deals, but it can also trigger expensive impulse purchases and whipping out your credit card.

In short, make your holiday budget as soon as possible. Withdraw that cash to set your limit. Then, start looking for deals so you can get your gifts in stock, on time, and at the lowest possible prices.

Which days are worth marking on your calendar? The most obvious ones are Black Friday and Cyber Monday, which surround Thanksgiving, but Free Shipping Day on December 14 is another way to score savings.

Be Creative

You don’t have to buy something from the mall or online to give a gift, as you can make your own or give the gift of time.

A quick Internet search will yield several homemade gift ideas and the steps necessary to make them. You could also offer up favors instead of material gifts by exchanging your time doing things for loved ones like babysitting, housework, running errands, etc.