Yes, we’re getting ready to go into September and not November, but when you think about how close November is to September, it dawns on you that the holidays are right here, knocking at the door again. And yes, we also realize that there’s still plenty of time, but that’s exactly the point of this week’s column – ensuring you’re financially prepared for the holidays so that you’re not burdened during the holidays.
Besides, who says you have to wait until a month before Thanksgiving before you begin planning for the many holiday events?
At this point, there are a couple options: you can start buying a Christmas gift or two and put them back so that you’re not having to spend so much money at one time or you can max out your credit cards. And you know what happens when you turn to your credit cards as a last resort.
She’s Financially Prepared for the Holidays
Jessica, a reader from Ohio, agrees.
I’m a single mom and if I didn’t begin shopping and saving during the late summer, I’d be pulling my hair out by the time Thanksgiving rolled around. The cost of everything is up these days. I start buying for my two teenagers around the first of September and usually, I try to finish up their shopping by mid-October. Picking up a thing or two as I go is so much more affordable and it allows me to keep my credit card balances low since I often pay cash.
She then explains that she always has menu for Thanksgiving and Christmas ready by mid-October and that too allows her to spread out the expenses,
Any can goods I use, I’m able to pick up and the closer it gets to Thanksgiving, the more I’m able to pick up all of the perishable items like eggs, the turkey, vegetables.
If you’re wondering, this is the third year she’s gone into the new year with no additional credit card debt due to holiday spending. That alone is impressive as financially analysts say credit cards will likely be the go-to payment source for the 2013 season.
But what else can consumers do to prepare? Holly Petraeus with the Consumer Financial Protection Bureau has this to offer to consumers.
Insert the Occasional Reality Check
You might can fool those in your circle, but you have to stay honest with yourself. If you go by last year’s averages, you can expect to spend $854 just on gifts. Most of us would feel that burn if we had to let go of close to $1000 right now. Stay realistic with your finances. Expensive isn’t better and quantity isn’t love.
Don’t underestimate the many websites that offer rewards, big savings and exclusive offers. Many coupon sites team with some of the biggest retailers in the world to offer members the opportunity to get free shipping and access to early bird sales. If you buy that new tablet your daughter’s been asking for, would you be willing to buy it a couple months in advance if it meant saving $150? Of course you would. And this is the ideal time to find deals just like those. The other bonus is you’ll likely have to use your credit card online (or debit card), but it also means you’ll have plenty of time to pay it off before the holiday season is even in full gear.
Whether it’s psychological or common sense, we simply do better when we have a budget. We’re aware of its existence and we’re aware of the good things that come from sticking with it. Now’s the time to plan your gift budget. Include everything you’ll be spending any money on: gifts for co-workers, family members, best friends, charities, decorations and wrapping paper, etc. You can then watch how that budget improves or begins to fall apart because maybe you’re not as disciplined as you’d like or perhaps an unexpected expense came up. You’ll know when it’s time to rein in your purchases and if it’s not, your first glance at your credit card statement will likely be yet another incentive.
It’s true that many people incorporate coupons into their money saving toolboxes, but the truth is that it’s not for everyone. There requires a certain discipline to stay on top of things like expiration dates, product size requirements, etc. If you have a few hours to clip coupons, by all means, do so. If not, and maybe this is because we don’t do much coupon clipping around my house, recognize that it might have value, but so does your patience and time.
Even Earlier Preparations
By the time we come out of the 2013 holiday season and after we’ve rang in the new year, perhaps a quick trip to your bank to open a Christmas account is just what’s needed to allow you to continue to grow in your new sense of financial responsibility.
Prepaid Debit Cards
Worried you just aren’t disciplined enough to cover these bases? You might want to consider the prepaid debit cards that are available. Before you assume they’re simply money eaters, you should know they’ve evolved in recent years. Many still incorporate high fees, but for the most part, these financial gems are quite attractive. The best part is that because so much competition has emerged over the past two years, competitors have consistently dropped convenience and other fee structures. The BlueBird is a fine choice from American Express and Wal Mart. Its low fees come with no strings attached, too.
Understand the True Value
Finally, and maybe this is the most important reality, don’t underestimate the beautiful opportunity to find your sentiment. My sister has begun preparing cookbooks for her daughters. They’re handwritten with all of the recipes she’s made for her family over the years. Each one receives a gift from “Santa” in their stockings each Christmas morning. Those gifts are small, spiral bound index cards, filled with sweet stories of when they were little girls. One story might be a memory of their trip to Gatlinburg years ago. Another story might include a family joke – the time one niece cut her sister’s hair off and proudly marched into the kitchen and announced she was going to be a hairdresser when she grew up. The girls were 5 and 6 at the time.
It sounds almost trivial, but make no mistake – those little gifts are the highlight of our Christmas evenings spent together as we reminisce as a family. And I’ve said it before: ask either of my niece’s what they received for Christmas two years ago and the only thing they remember are the next volumes of their recipe books. The material things are great and they both are grateful, it’s just that those special gifts mean so much to them that they eclipse the boots or jewelry or martini glasses they might also receive.