Eleven months from now another holiday season will be upon us and we will be celebrating the season again. Along with holiday season comes holiday spending. Everyone perks up during the holidays from retailers to carpet cleaners; everyone is trying to get you to spend your hard earned money.
And then comes January and with it the holiday bills. The cold of winter sets in along with the cold reality of the real cost of your holiday spending spree.
If you take a little time and start planning and saving for the holidays now, it may be a lot less painful and stressful when January 2013 comes. One reason for this is that the less time you have during the holidays; the more likely you are to spend more money just to get things out of the way and get done shopping. The following tips will help you next holiday season.
Make Your List and Start Shopping Now
Since your holiday budget is likely to be similar to last years, you can come up with a budget now and use it to plan and purchase gifts now. Advanced planning and purchasing of gifts removes deadline pressure the holidays sometimes brings. Again, the less time you have at the holidays, the more likely you are to be coerced to spend money you do not have or spend money you do not want to spend. Planning and purchasing in advance does remove some of the deadline pressure that the holiday brings, but it does require some added consideration as far as gifts are concerned. You have to be more thoughtful about the gifts you’re buying and ask yourself will this person like this or be able to fit an item eleven months or so from now.
Additionally, shopping ahead allows you the opportunity to make the best of sales and seasonal trends. And spreading out your spending over a ten or eleven month period is a good way to avoid using credit cards. Buying a lot of items in a short period of time is one of the reasons that people use credit cards during the holidays. One of the reasons why people use credit cards during the holidays is they are going out and buying a lot of things all at once.
Start Saving and Set Aside Some Money Now
Set up an automatic deposit to a savings account or Christmas club account for the holidays. At first, it may seem difficult, but before long will not miss the money going in to the account and come Christmas time, you could have a good some of money and will not have to use your credit card to pay for the holidays.
A Christmas club account is basic and may seem old fashion to some. You put aside a little bit of money on a regular basis, it adds up during the year and you get that money in a lump sum just before Christmas. It can be funded with money deducted from your paycheck
Many credit unions offer Christmas clubs accounts and they are still an effective way for budgeting for the holidays. Why do you think your grandparents used them?
Take it a step further and set up club accounts for every member of the family. Setting up separate accounts for mom, dad and the kids could be a great way to get them involved and teach them how to save and manage money.
The interest you earn on the account is not much but it is a far less expensive way to fund the holidays than credit cards. And because of penalties for early withdraw; you are likely to leave the money alone.
A money market account or a short term certificate of deposit is also good ways to save. With the money market you will get a reasonable rate of return and you will be able to get to your money when you want to. A certificate of deposit may give you a greater rate of return, but there may be limits or penalties if you take the money out early or do not take it out at all. Additionally, with the CD, you may not be able to make more deposits in to the account.
Plan and save for the holidays now. Advanced planning and purchasing using last year to create a budget, will put you way ahead of the game. Furthermore, check with your bank or credit union today about some type of savings vehicle for your holiday savings…start today..
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