Top 3 Tips to Avoid Credit Card Debt During the Holidays
There are few things better during the holidays than finding the perfect gift for someone you care about, but sometimes the relief that comes with scouting out the right present for your new mother-in-law or a great accessory for a close friend can come with a heftier price tag that you planned. This sometimes leads to a severe case of anxiety and buyer’s remorse when your next credit card statement arrives.
Credit card purchases often rise during the holidays and wane in January – but many spend the first few months of the New Year focusing less on their resolutions, and more on trying to pay off high balances. Instead of mulling over purchases and worrying about how to pay off the balance, adopt new strategies to limit card use. The following are a few rules that I employ to avoid the holiday financial hangover:
1. Make a Rule For Credit Card Purchases
Swiping your credit card for every cup of coffee alongside other small purchases seems harmless, but when you add these items up with your holiday spending, your balance can quickly spiral out of control. Having self-imposed rules and boundaries to limit credit card use to certain purchases can discourage you from making many small purchases that add up over time.
2. Pay with Cash
A number of studies show that shoppers who pay with cash tend to not only spend less, but think more carefully about what they’re actually purchasing than those people who rely on credit cards. When you hand over your savings, you may feel a slight twinge of pain at seeing the money physically leave your wallet, but knowing that you won’t face a big credit card bill in January should soften the blow. If you use credit cards for your purchases you may fall victim to temptation and overspend on items you don’t really need.
3. Sleep on It
Impulse purchases are dangerous. If you’re trying to adhere to a budget it’s easy to rationalize why you need it rather than of why you want it. “Yes, it’s the perfect New Year’s outfit and it’s on sale,” but if the price tag is more than you can afford, it’s a good idea to go home and give it two or three days thought. Many times you may find that you don’t actually need the item — but if after thoughtful consideration you still think it is a great deal, you can go fetch it!
Do you have holiday saving and shopping tips? If you do we would love to hear them! Please put your ideas for a less costly and stressful holiday season in the comment section!