It can be fun to go on a shopping spree at the end of the year but it can also put a big hole in your wallet. There are many expenses that need to be spent and you can easily make money mistakes while trying to make sure that you follow up on your holiday plans. The following are 5 tips on how to avoid making financial mistakes in the upcoming holiday.
1. Don’t Exceed Your Budget
The first step is to plan your holiday shopping list by writing down every holiday expenses on piece of paper. When compiling the shopping list, make sure you include everything including parties, cards, gifts, decorations and etc. By taking a look at the list, you can estimate how much you have to spend. Now that you know the estimate expenses, you can plan accordingly on how to save and come up with that amount of money.
2. Don’t Use a Credit Card
Many people find it convenient to use their credit card to pay for holiday expenses. If you use a credit card, you will be in debt for several months after Christmas is over. Using credit card also can lead to overspending and exceeding the budget. Planning carefully prevents you from having to use your credit card to pay for your holiday expenses.
3. Don’t Get a Personal Loan to Cover Holiday Expenses
It is best to avoid applying a personal loan to cover your holiday expenses. Getting a loan is a financial commitment and you have to pay back every month thereafter along with the interest rate. It adds worries to your life as you try to meet the repayment at the due date every month. Saving your money to pay for the holiday expenses is the best solution to avoid holiday debt. Starting to save your money early can give you enough time to accumulate the funds you need for paying the holiday expenses.
4. Don’t Buy Expensive Gifts
It can be tempting to buy expensive gifts for everyone on your list just to impress them but this is not the wise thing to do. If you spend money on expensive gift for everyone, you’ll find yourself exceeding your budget soon. Instead, you should only save the expensive gift for those who are closest to you.
5. Don’t Forget Anyone on Your Holiday Gifts List
When going for shopping, make sure you carry a list with the names of the person that you are buying gift for. As you buy the gift for each person on the list, you can cross of his/her name on the list. This can prevent you from making mistake by buying gift again for someone whom you have already purchased the gift.