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5 Things You Need To Know About Managing Your Money This Holiday Season

This article is more than 6 years old.

Do you cringe every month when you go to look at your credit card bill? Don’t lie. We’ve all been there. Not too long ago my wife and I were in $30,000 worth of credit card debt. So, I get the feeling. Heck, we still have some debt to pay off that we’re throwing every extra dime at.

Now, remember that credit card bill? Well, how do you think it’s going to look after December 31 of this year? Yeah, probably even larger than it is now. Turns out credit card companies aren’t exactly the biggest “givers,” unless we’re talking high-interest rates on our debt.

We all have enough bills. Let’s explore how to avoid taking on more debt this holiday season and starting the new year off on better financial footing.

Set a holiday budget and stick to it. The holidays are a time for giving, not for showing off. Don’t buy the most ostentatious gift just to show people you can or that you make a lot of money. This doesn’t impress others and it certainly won’t make you happy once the credit card bill comes.

Instead, be mindful of your holiday expenses and set a reasonable budget. As Forbes contributor Nick Clements explains, “It is better to make difficult spending decisions before you start shopping, rather than waiting until you are in the store facing temptation.” I couldn’t agree more with Nick’s take here. Don’t let holiday gift giving sneak up you. Plan properly and you will be in a much better financial situation come January 1.

Come with alternatives to the typical gifts you give to family and friends. Don’t just exchange gifts of the same dollar amount with others for the sake of giving a gift. It’s ridiculous.  Instead, come up with dates to spend time with your loved ones and make that the gift. Find fun excursions or mini vacations you can take and pool your money together. Sure, the holidays are a time to be generous, but not wasteful. Rather than exchange different gift baskets with your siblings, find an affordable alternative to make time to be together and set aside that money. This way, if you push it out until the middle of next year, you have time to put the money aside.

Earn some extra money this holiday season. Another way you can get ahead financially is by earning extra money to pay for all of your holiday gifts, parties and other expenses. Rather than dip into your main income source, find ways to bring in more money to pay for everything.

It can be as simple as working extra hours at your current job, finding stores that need extra help for the holiday season, or even getting an online job using skills you already have. Of course, there’s always filling out surveys on mobile apps like Swagbucks too. Stick to your budget and bring in money that equates to your budgeted amount – and you can then save that amount of money from your main income source! Not a bad way to pay yourself back or even put on other debt.

Sell items you no longer use, want or need. We all have that stuff that accumulates in our basement and closets all over the house. You know what I mean. It’s that junk that we always say we want or need when we come across it pulling out the holiday decorations that year, but forget about as soon as we start stringing lights on the tree.

Here’s a thought. Get rid of it! Don’t wait until spring cleaning. Have some holiday cleaning instead. Put those baby clothes, that old desk or the pool table collecting dust in old boxes – and sell that stuff on your local Facebook yard sale group.

Who knows? That old desk from your Aunt Judy you never use could turn into an Amazon gift card for your boss. You never know until you try – and it costs you nothing.

Make the payment immediately. If you do decide to use a credit card for online holiday purchases, don’t let the balance sit and accrue interest. Save yourself some money by putting the amount you budgeted for holiday gifts on the card. Even if you’re lucky enough to come in under budget, if you have outstanding credit card debt, put the full budgeted amount on it. You will save yourself some money in the long run and pay down your overall debt faster. The amount you spend on holiday gifts won’t be on the credit card bill long enough to rack up more debt.

Getting out of the holiday season without going further into debt doesn’t have to be a difficult undertaking. With careful planning, determination and a little sacrifice, you can begin the next year satisfied with the thought of giving to others without putting yourself in a financial bind.