Holiday spending is one of the biggest reasons Americans go into debt. Nearly half of Americans will take four months or more to pay off all that debt, with nearly 12% opting to make only the minimum monthly payment. Those high interest payments could be better spent on a retirement plan, a down payment on a new home, a vacation or investments.
So what can you do to make sure you enjoy the holiday season without overspending?
Use Your Bonus to Buy Gifts
If your company gives you a bonus at the end of the year, dedicate that money towards holiday gifts instead of using your credit card or savings.
Plan a Vacation with Loved Ones
If your budget is tight during the holidays, set aside a week or even a weekend for a vacation with loved ones later in the year. This will give you more time to save up for that event instead of putting gifts on high interest credit cards.
Plan Ahead and Stick to a Budget
Going into the holiday season without a plan can almost guarantee overspending on expensive gifts and even worse, relying on credit cards to help cover what you can’t.
Plan ahead of time how much you will spend on gifts, decorations, and hosting holiday meals. A budget will help you make sure you’re not overspending and that you have all of your holiday expenses covered.
Shop the Sales
So many stores offer great deals and discounts throughout the holiday season so be sure to make the most out of these opportunities. If you plan ahead and know exactly how much you’re spending and what gifts you are buying, shopping the sales should be easy.
Automate Your Holiday Savings
Ask your bank about automatically setting aside a small amount of your paycheck each week in to a savings account. Many banks will even offer a holiday savings plan. If you start saving small amounts in January, by December you will have plenty of funds for shopping without turning to credit cards or other savings accounts.
About Rochester Mortgage Lender, Julie Krumholz
Julie Krumholz is a mortgage lender that serves Oakland County, Macomb County and the entire state of Michigan. She has over 30 years in the mortgage industry and brings a wealth of experience to her clients.
Are you ready to see if you qualify for a home loan? Or need more information on how to improve your debt-to-income ratio or credit score? Contact Julie Krumholz from Main Street Bank at: 586-382-5482 and let her help you navigate through the loan process.