Holiday debt: Tips to avoid overspending
It’s the most expensive time of the year as many are likely to face financial pressure to spend more on Christmas gifts.
But for some, last year’s holiday gift tab still lingers with 15 percent of Americans still paying off holiday debt from last year which averaged $1,054, according to The Motley Fool.
However there are ways to save for the holidays and avoid sinking too deep into debt.
“The most important thing is to remain in control,” said Ramsey Solutions financial expert Chris Hogan to FOX Business’ Maria Bartiromo on Tuesday. “You don’t want to let the holidays make you crazy.”
Hogan offered four tips to stay in control of debt.
Stick to your budget
Allocate a dollar amount of what you want to spent and who you will shop for, according to Hogan. He also suggests tallying up what you’ve already spent so far.
“A lot of people have been shopping throughout the year for Christmas,” he said. “So be aware of what you already bought and what you’ve already spent.”
Use Cash
Cash is king --especially during the holidays, when it can help you control and understand your spending limits.
“If you’re going to spend $100 for your brother for Christmas,” he said. “When that $100 is gone you stop.”
Avoid store credit cards
You’re ready to pay – and just as you reach into your wallet the cashier says “would you like to sign up for our store credit card and get an extra 10 percent off?”
However Hogan said it’s wise not to fall prey to these devious incentives.
“These things are sneaky… and they are a thief,” he said. “It’s amazing that they’ll offer you 10 percent off that day but charge you 4 percent every other day.”
Don’t buy gifts for yourself
Hogan advises keeping purchases for yourself to a minimum.
“Twenty-two percent of Americans buy gifts for themselves when they are shopping for others,” he said.