DULUTH, MN-It’s that time of year to spread holiday cheer, but experts say it’s also a time to spend that money.
“This is the time of year where budgets get out of whack, racking up credit card debt and spending on interest in fees for the rest of the year,” says Lead Advisor, of Great Waters Financial, Barry Bigelow.
According to research by the National Retail Federation, the average person spends about $1,000 on all their holiday shopping.
Nipping the thought of overspending now will help prevent you from becoming the Grinch for the rest of the holiday season, says Bigelow.
“Start by reviewing your own personal financial situation first, then take inventory of the people you want to give to, what you want to spend and what gifts you want to give to make sure you’re that it’s still within your budget to be able to do that,” said Bigelow.
If your finances are not the best, Bigelow says you may want to think of options like doing secret Santa, buy experiences- like zoo and movie passes, or investing in your child’s future education.
“Give a gift that lasts, it’s a way to do things that actually stay with them rather than a gift that they throw away in 6 months or that breaks when they pull it out of the box,” said Bigelow.
Turning to credit cards could also be hurting you more than helping.
“Paying fees on these deals that you buy on Black Friday leading up to Christmas is one way to actually pay more than the original asking price for the gift. Don’t do it unless you’re going to use it for points and airline miles and going to pay it off that month after you use it,” said Bigelow.
Bigelow knows there’s pressure to get nice gifts around the holidays but its never ok to go into debt just to give.
“Take the pressure out of the holidays this year if you can’t afford to give gifts, just be present that’s a gift enough,” said Bigelow.
If you want more tips on how to prevent overspending this holiday season click here.