How to Avoid the Post-Holiday Financial Blues
Are you financially prepared for the Holiday Shopping Season? Will you be making your purchases with cash or credit? Do you have a planned amount of money you will be spending on gifts? If you owe $5,000 of more on your credit card or know someone who does, who only pays the minimum payment each month, you are not alone. The levels of consumer debt are increasing rapidly around the world. A Debt is Not Just for Christmas Christmas is the time of year when many consumers fall into the trap of spending too much money on expensive Christmas gifts. Most of these purchases are made on credit cards rather than using cash. This means these consumers often end up with large credit card debt in the New Year. The New Year is also the time when bills for other expenses, such as holidays, school fees and taxes come due.
Credit cards are an expensive convenient source of money and many people don’t realize just how expensive they can be. Remember gifts purchased on your credit card that you will not be paying in full, will become a debt. This debt will be with you long after Christmas is gone. The most damaging part of this process is the interest you pay on your holiday purchases over time will be more than the cost of the gift. This interest payment you are making will also become someone else’s investment return.
Tips to Avoid the Post-Holiday Credit Card Blues 1. Make a budget for Christmas spending - add 20% to the amount and stick to that number. 2. Write a list of everyone you plan to buy presents for and the amount of money you can afford to spend on each person’s gift. 3. Pay for presents using cash or lay-away rather than credit cards - if you have to use credit cards use only one.
Sebel Hawkesbury Articles
Sebel Hawkesbury Books