How to Avoid Holiday Consumer DebtDec 06, 2017
Everywhere you turn during the holiday season there are opportunities to spend and that can lead to taking on more consumer debt. Whether it’s shopping for gifts, entertaining, or donating to charity it’s important to have a plan for where your money goes during the holidays.
Here are a few of our best tips on how to avoid holiday consumer debt.
- Build a holiday budget and make a plan
It’s time to expand on your regular monthly budget. You’ll need to factor in all of the extra expenses that can come with the festive season. This holiday budget calculator from Practical Money Skills Canada highlights a bunch of the major holiday expenses and provides an idea of what you can afford based on your income.
Using what you’ve learned from the holiday budget calculator it’s time to build a plan to keep you within your budget. A good budget will still allow you to be able to check off everyone’s Christmas wish list without relying on taking on new debt.
Check out SimplyFrugal’s holiday plan worksheets to help you put what you learn from your holiday budget into action.
- Put the credit cards on ice
You do not literally have to freeze your credit cards in a block of ice, but the premise behind it is a great way to help prevent taking on consumer debt. By leaving the credit cards at home and using cash, you’ll have to manage your purchases wisely. Think of it as a preventative debt relief measure you can take to help with debt.
- Start a savings plan now for next Christmas
If you’re behind on saving for the holidays you’re not alone, a recent poll found that a good number of Canadians are not saving for the holidays throughout the year. As part of your plan for this holiday season start thinking about Christmas 2018 now.
Perform a post-holiday audit of your spending. What you find out can help you create your 2018 holiday season savings goals. Setting up automatic monthly transfers from your main bank account into a savings account now, is an easy set-it-and-forget it way to get a head start on your holiday savings – and a great way to avoid adding to your consumer debt next December.