Black Friday has come and gone and for some retailers, this was their shot at staying in the black. For too many consumers, however, holiday spending can put them in the red. Here are some tips to make sure you aren't paying for this year's holiday into the New Year.
Make a budget and stick to it
The average American racks up more than $1,000 in holiday debt. And, despite their best efforts, many struggle to pay it off. Even though 65% of Americans set a holiday budget, 77% expect to exceed it. Reasons for this include forgetting to account for entertaining, going out or gift wrap and decor. So, budget carefully and, if you didn't budget for something this season, skip it.
Get more bang for your gift-giving buck with one of these strategies. For extended family, consider drawing names out of a hat. This allows you to save money and give a nicer, more thoughtful gift. Or, make gift giving into more of an event. A white elephant theme is a party and gift exchange all in one. It can even help you clear up space. Another option is to go in on a bigger ticket item with a few people, the recipient gets something special and you stick to your budget.
Take advantage of a fun night in
Don't get me wrong—going out is fun. But long waits, inflated holiday prices and restaurants so crowded you have to shout to be heard is not so fun. Instead of a night-out on the town, consider hosting a potluck instead. Pick a theme, like "Candlelight Cocktail Hour" or "Holiday PJ Party" to make it festive. And, if everyone brings a dish, then you don't have to worry about picky eaters. You might even have more fun than if you had gone out. If you're putting on a fancier gathering, consider co-hosting with a close friend. In addition to saving you money, it can save you prep and cleanup time during this busy season.
Prioritize for next year
Maybe you already splurged on the giant flat screen. There are still ways to get ahead. If you accrue any debt, come up with a plan to pay it off. Then, start planning next year's budget. Factor in holiday spending so you can save for it ahead of time. Keep a running "gift idea" list on Amazon and watch for sales throughout the year.
Don't forget about yourself
Why guess and hope for the best when it comes to your financial future? This holiday season, give yourself the gift of confidence in your financial decisions by working with an advisor.
This article was originally published in the December 2019 issue of Living on the Lawn.
Robert Carson is a Senior Vice President, Financial Advisor at Wealth Enhancement Group. Securities offered through LPL Financial, Member FINRA/SIPC. Advisory services offered through Wealth Enhancement Advisory Services, LLC, a registered investment advisor. Wealth Enhancement Group and Wealth Advisory Services are separate entities from LPL.
The opinions voiced in this article are for general information only and are not intended to provide specific advice or recommendations for any individual.
Robert joined Wealth Enhancement Group during the 2019 partnership with Planning Solutions Group, where he was a Managing Partner for the firm. He specializes in providing comprehensive financial planning strategies, with an emphasis on estate preservation, business succession planning and asset management.