Don’t Increase Debt During the Holidays

I read an article yesterday that Americans will spend an average of $719 on holiday gifts this year. And it seems like there are even more temptations to spend this year – from stores opening early on Thanksgiving to commercial jingles about using layaway.

With all these temptations around, it’s important to remind ourselves that there is more to the holidays than gifts and that we SHOULD NOT spend money we don’t have. Roughly one in six Savers that has joined America Saves has selected paying off consumer debts as their wealth-building goal. We want to help savers achieve this goal and be able to buy the gifts they need to this holiday season. Here are a few tips to keep in mind:

  • Keep Gift Giving to a Minimum
      • Figure out which gifts are absolutely essential – often times this will be gifts for a child or loved one.
  • Comparison Shop
    • While there are some good deals during Black Friday, know exactly what you need to buy and shop around to get it for the lowest price.
  • Avoid Impulse Buys
    • One of the easiest ways to overspend at the holiday is to buy gifts you didn’t plan on. Make a list and stick to it.
  • Make a Plan on How You Will Save for the Gifts you Need
    • There is still time to save for the gifts you need to buy. You may need to forgo items for yourself but that will make gift giving even more meaningful.  Click here for more on keeping track of what you spend and budgeting.

Why too much debt is Costly?

Borrowing more money than you can afford is costly in many ways. Americans spend well over $75 billion a year just on credit card interest and fees. That means that families who revolve credit card balances pay an average of $1,500 a year in interest and fees. If they saved that $1,500 in an account with a five percent yield, in 40 years they would have nearly $200,000! Learn More.

Are you planning on keeping gift giving to a minimum this year? Let us know on our Facebook page.

Related articles:

Keeping Track of What You Spend and Budgeting
The Hardest Part About Getting Out of Debt

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