Hi, it’s your Hendershott Wealth Management team, and the holidays are almost here!
Like you, we can’t wait to spend time with loved ones and share the generous spirit with family and friends. It’s the season of giving, right?
There’s just one problem… That gloriously tempting day (week?) dancing at the end of November. You know the time right after we’re supposed to celebrate and be grateful for everything we already have…
Only to buy even more over the next week!
Black Friday. Cyber Monday. “Every Day Is Black Friday” deals from your favorite retailers.
It’s dangerously easy to tippity-tap that alluring new scarf or shiny thing into your cart.
However, it’s not-so-fun when the season of giving quickly slides into the season of debt.
Yes, you want to shower your loved ones and even yourself with gifts, but it’s important to remember, more gifts can lead to more debt.
So, how do you stay VISA-shock-free this year?
First, let’s keep it in mind you can have an amazing festive season while still playing well inside your budget and avoid overspending.
Here are a few easy steps to help keep you and your wallet thriving into the new year!
1. Create (and Stick With) Your Budget.
The key is creating a spending account or budget.
Whether you create a separate spending account or set a budget, you want to clearly identify how much you want to spend on each person and activity.
Keep in mind your typical expenses when doing this to ensure you don’t come up short on bills and other obligations.
If you truly struggle to stick with your budget when shopping with friends or family, you may want to consider shopping by yourself.
You don’t want to be pressured into buying something that you never planned on buying anyway.
You can avoid the stress, go by yourself, and focus on buying only the items that you wrote down on your shopping list.
2. Follow St. Nick’s Example and Make a List.
Speaking of your list…It’s easy to get carried away during the holiday season and with all the excitement. One great practice to help keep your shopping in check is to make a list.
(And thanks to St. Nick’s example, it’s also a good idea to check it twice!)
The practice of making a list will help you stay accountable.
Once you identify who will be receiving gifts from you, you can make a list of all the gifts you need and cross them off one-by-one as you purchase them.
Having this strategy in place before you go shopping will help you avoid buying unnecessary items.
We both know how tempting it can be when you see sales and the holiday deals popping up.
Sticking to your list makes it less difficult to buy what you actually need, preventing you from making expensive splurges.
3. Focus on Needs.
Speaking of needs, consider buying what people on your list actually need.
If you buy gifts your loved ones will treasure forever and may even improve their lives, they will love those types of gifts.
Meaningful gifts need not be expensive either! It’s the meaning behind the gift that matters most and what people will remember.
4. Get Creative!
No, financing your holiday gifts for the next 12 months isn’t creative. There are many ways to create thoughtful, personalized gifts that deliver a beautiful memory.
Although it may not work for everyone on your list, you could pick up a new skill while gifting creative homemade presents, such as homemade mixes in a mason jar for hot chocolate, cookie mixes, and soup bases.
Another fun option is creating calendars or mugs with pictures or collages of your shared memories.
Take advantage of your talent and avoid increasing your credit card debt from purchasing high-ticket items.
5. Know Your Budget Numbers.
How much are you going to spend before you pay? If you don’t know that number, you will find yourself in a mental-emotional tug-of-war at checkout.
By knowing whether you will be using cash or credit cards to pay for gifts, it’s easier to stay within your budget.
If you already have the amount of money you plan to spend before entering a store, you are limited in what you can spend because once you spend the money you have, that’s it!
If you are planning on using credit cards, make sure you think about how you will pay your entire credit card bill. Again, ‘financing’ holiday gifts is not the answer.
It’s easy to just keep swiping away with credit cards, so make sure you watch your credit card debt.
Having a plan means you can confidently pay your credit card bill after the holiday season.
6. Track Your Spending.
Keep track of what you spend. Having a list of what you have already bought allows you to track your holiday spending and check in with your financial goals.
Are you over- or under-budget? Knowing the answer to this question could be the difference between experiencing peace-on-earth or stress after the holiday season.
You want to keep track of what you spend so you’re not surprised if you happen to go over your budget.
It’s also helpful to note any items that you may be able to find less expensive alternatives for to see if you can save extra.
Now, buyers beware, if you don’t find what you’re looking for at the usual store and then, ‘magically’ the same item pops up on an obscure retailer’s website.
Same product at half the price? That’s likely a trap, a scam, and it may end up with you getting a cheap knock-off version of what you really want or worse, you could be the victim of identity theft.
(We’ll cover online identity theft more in next week’s issue of Profit Boss Weekly.)
Having a Plan Means You Get to Enjoy the Holidays With Less Stress
The last thing you want to think about before starting a brand-new year is getting stuck in a debt trap.
Planning out and managing your holiday expenses can help keep an already bustling, busier-than-usual season in check.
Whether it’s by creating a budget, tracking your holiday expenses, or buying only the gifts you need, taking time to plan and prepare can help you avoid the stress that often comes with the holidays.
Even though it seems like the holiday season is stressful, it doesn’t have to be if you make a plan and take the appropriate actions.
Now, time for some Michael Bublé, a cup of cocoa, and a quick dive into Etsy…
To your prosperity,
Hilary and your Hendershott Wealth Management team
