Are you ready to spend almost $1,000 on Christmas this year? According to some pollsters Americans will be spending (on average) $900 this holiday season. That’s just what they PLAN to spend- there’s no way to predict how much they might overspend. Although, Kate Ashford’s recent article for Forbes “8 Ways To Keep A Leash On Holiday Spending” references a TD Bank survey that suggests 78% of people will go over their budgets. Not only that but they estimate they will run over budget by $200 on average!
I contributed some ideas to Kate’s article (see "Don't be afraid of the Returns Desk"). Which got me thinking about what actions people can take to prevent a January spending hangover. Whether you are procrastinator (like me) or are well on your way to finishing your holiday shopping. Use these ideas to create a holiday spending plan so you can start the New Year off right!
Let's make a holiday spending plan!
1. Write down what you can reasonably spend on Christmas presents (without going into debt).
2. Make a list of everyone you are shopping for this season.
3. Create a rough budget for each person on your list. Be realistic- would you want someone in your life to go into debt to buy you a Christmas present? The answer is "No!" You can safely assume that everyone you are buying a gift for feels the same way!
4. Brainstorm a few ideas on what you might like to get each person on your list so you won't be so tempted to make impulse purchases. Write these ideas down and bring them to the store with you (consider using a “notes” app on your phone to write your list on).
5. A lot of people find it helpful to use cash when they go Christmas shopping. It forces you to stick to your spending plan.
If you go overboard, don't give up
One last idea that not everyone thinks about- what happens if you realize that you went a little overboard on Black Friday and now your holiday budget is blown?
Don't be afraid to simply return the gift to the store and buy a different gift for that person. The retail worker is not going to be spending time thinking that you are returning a gift because you overspent. I have worked in retail, and I can tell you that I did not care why people were returning something unless it was damaged.
Just make sure your return request fits within the store’s policies and be nice. 🙂
People tend to view spending slip-ups with a certain level of shame. This shame or embarrassment can then stop them from taking action to fix the mistake. Instead, re-frame the situation - you went overboard, you recognized your mistake and then you took action to fix it. That's something to feel good about.
Being able to recognize mistakes and take action to fix them will help keep you on the path towards building not just financial security, but financial independence.
Have you ever returned something after realizing it wasn’t the right choice for your finances? How is your Christmas or Hanukkah shopping going? What are your tips for staying on track with your holiday spending plan? I would love to hear from you!
If you are looking for help creating a spending monthly spending plan you will definitely want to read this: How to Easily Create a Monthly Spending Plan.
1. Gallup poll November 9-13, 2016 http://www.gallup.com/poll/198080/americans-holiday-spending-shaping-average.aspx?g_source=Economy&g_medium=newsfeed&g_campaign=tiles
2. American Research Group poll November 17-20, 2016 https://americanresearchgroup.com/holiday/