The holidays are a wonderful time of year. The holidays are a time of giving, but sometimes the giving can get out of control and cause some headaches. Everyone wants to give their family and friends the best but it is at your expense. Sometimes this is fine but sometimes it can bring on some major debt for families. Here are some tips on how to get a hold of your holiday debt.
Prior to the holiday season, make sure to be aware of your current financial situation. Go through your finances and see what you can budget for and plan from there. If you know you can spend a certain amount in total, than divvy up where you can spend those funds. Some people know they can get out of control when it comes to gift giving. When you are one of those people, it is imperative that you budget before your spending becomes a problem.
Parents want their kids to have the best christmas and will often go above and beyond to make it happen. The best way to do this is to earn as much extra cash as you can. Working extra hours or overtime is a good option. No matter what the sacrifice, if you are in a better financial situation during the holidays than it will relieve some stress.
It is a fact that the holidays are financially burdensome. If you spread out the financial strain throughout the year than it will easier to handle. Now this takes a lot of planning and discipline to execute but it will be for the greater good. Maybe start buying in the summer or buy as see good deals throughout the year.
Make your own gifts! People tend to save money when they do it on their own, and it often is more well received from others because the thought and time was spent on them. Making things are cheaper because materials are typically cheaper and not marked up. For example, you would pay more to buy a painting than to paint one yourself.
If all of this doesn’t seem to cut it and you need to borrow money, whether it be credit card debt, lines of credit or even a loan, be sure you are doing it in a smart way. Make sure to research online and compare credit cards to see which ones will work for your favor (rewards, rates, etc.). Some lenders report to the credit bureau and it allows you can actually improve your credit score while borrowing. Sometimes the rewards from credit cards can be used during the holiday season as well, so looking into this early on will work in this situation as well. If you look at your debt to income ratio that can tell you if you are making a wise decision. You don’t want that ratio to be too high.
With these tips you can hopefully avoid making the holiday season a stressful time because of finances. Get ahead of your debt while you can.