Author Elaina Johannessen is program director for debt management plan operations with LSS Financial Counseling.

Planning Ahead is a tool to Avoid Debt this Holiday Season

While it still feels like summer as I write this, it will be winter before you know it. And if you celebrate Christmas, Hanukkah, Kwanzaa or other December holidays, there are only a few months to prepare and buy gifts. So many people go into debt each year putting gifts on their credit cards. Therefore, I encourage you to get the ball rolling on your plan for holiday shopping this year. Keep reading for some helpful tips to avoid the post-holiday debt blues.

1) Make a list and start now.

A simple way to avoid credit card debt from the holidays is to create a shopping list AND a spending limit. The earlier you start the better, because that means you will have more paydays to make purchases. So, don’t wait; get that list made, and get started. Keep in mind that the list is important; you can eliminate impulse purchases and overspending, and you are far less likely to forget someone on your list.

2) Save up some money simply.

Your credit union or bank might offer to transfer your change from debit card transactions. For example, if you spend $12.20, your financial institution will automatically transfer the remaining $0.80 into your savings. Also, save your actual change in a jar, and let it build up.

Better yet, set up an automatic transfer to savings each paycheck. Determine what you can afford for this automatic transfer first. Then, let it build up, and voila! You have “extra” money for holiday shopping. You’ll be surprised at how quickly these little things can add up, especially if you implement multiple ways to save.

3) De-clutter to earn.

There are a plethora of ways to sell your never used or gently used goods. Between Facebook Marketplace, eBay, and many, many other online sites, it’s very easy to make some extra cash from selling your own stuff. There are even sites specifically for selling clothes. You could also hold a garage or yard sale while the weather is still nice.  

4) Prioritize and reduce spending.

I know, I know. Hearing me tell you to just stop spending seems depressing and boring. While I do suggest reviewing where your money goes, I’m not suggesting you give up every fun thing in your life. Just go through and determine if there is any area in your budget where you can save a few bucks, such as any subscription or streaming service, dining out or coffee shop beverages. Find what is feasible for YOU to cut/reduce, and save what you don’t spend each month. Even cutting out a music streaming service could end up saving you $5-$30/month, which, again, adds up.

5) Shop smart.

Using your list, determine the best place to buy gifts for your friends and family so that you get the best deal. There are apps that can help you compare prices. If you are an Amazon shopper, you can even save an item in your cart for later, and the app can notify you when there’s a sale. If you’re shopping online, try to find safe sites that offer free shipping. Starting early and finding deals can save you a bunch of money. 

6) Plan with your family.

While the holidays are supposed to be relaxing and enjoyable, they often are stress-inducing for a lot of people because of the financial strain. When you don’t have the money on hand to buy everything, you might feel forced into using that credit card. Please don’t give in! I can guarantee you that NONE of your family or friends would ever want you to be stressed out or go into debt to buy them a gift. So, talk to them. Be creative. Draw names to reduce the number of gifts y’all need to purchase, and/or set a limit for each gift. If no one really “needs” anything, make a memory together for the holidays instead of making it about material items. Play cards or a board game, bake some cookies, watch a classic holiday movie or go sledding. Time with family and friends is what the holidays are really about anyway, right? 

It’s really up to you to decide how financially stressful the holidays are. 

If you implement these tips, you can enjoy the holiday season even more, without having to worry about how you’re going to make credit card payments in the months to come. So, get creative, and make your holiday season as stress-free as possible!

We are here to help. 

If you are finding it difficult to make your credit card payments, LSS Financial Counseling is here to help. A Debt Management Plan might help you pay off your debt faster AND save money in interest. 

Call us today at 888.577.2227 to schedule your free session with a trusted, nonprofit financial counselor. You can also email us, or you can get started online by creating your financial profile.