How to Avoid New Debt This Holiday Season
It is the prime shopping season again. The holidays are rolling in and you may be facing average spending of $800 for gifts and presents. You are likely to use a credit card, too. Well and good if you are able to pay your holiday shopping at the end of the month; otherwise, it can spell disaster for your budget coming into the new year.
Here is a crazy thought though: what if you try to avoid, or at the very least minimize, your holiday spending to avoid creating new debt? Check out the tips below to enjoy this holiday season with more savings and money in your pocket.
1. Track your spending to stay on budget.
Digital wallet apps and mobile payments make it incredibly easy for you to track your money. You are always engaged with your devices, which creates a good opportunity for you to manage your funds better. Easy access means you can see where you are at any given moment.
2. Earn cashback and stack offers.
Save your cash while spending using cash-back credit cards and participating in other cash-back websites. You can easily stack the rewards and get more value for your money. However, remember to focus on your spending goals. The last thing you want is to let the cash-back offers to entice you to spend more than you would otherwise!
3. Monitor prices.
Yes, the holidays are a busy time, but if you use online tools, like browser extension and apps, to track the fluctuations of prices, you will get better deals for your online purchases. These tools can alert you once deals are out or sales are on. It is an excellent way to save money, especially in this shopping-heavy time.
4. Use the perks that come with your credit card.
Some credit cards offer price protection. This means you can get a refund for the difference if the price falls after you make the purchase. Extended warranties are also a common perk, as well as free shipping and limited discounts.
5. Do not delay paying the debt.
In case you accumulate a balance on your card, place all your effort in paying it off as soon as possible. If you make just the minimum payment on the card, a balance of $660 will take almost four years to clear. That is a lot of interest! This season, plan and pay attention to your spending. Being debt-free is the best gift you can give yourself for the holidays!