Steer Clear of Holiday Debt

As the holiday season is officially in full swing, many households are concerned about the inevitable debt that comes.  Fifty-seven percent of American adults with children say they are willing to take on debt to make their children happy, and this year, holiday debt will linger longer for middle-income families. 

The holidays do not have to end with a mountain of debt.  By combining savvy shopping, healthy restraint, and strategies for finding extra cash can bring you into the New Year without regrets.  Below are some helpful tips:

• Set a budget. Take a look at your savings and see how much you can afford to spend this holiday.  Stay on target and do not exceed your budget.
• Create a spending plan. This should include everything you plan to spend money on such as gifts, travel, parties, restaurants, etc.  If the final number exceeds your budget, find ways to get discounts or cut spending. 
• Meaningful gifts rather than pricey gifts. People often appreciate thoughtful presents that focus on experiences, memories or quality time with loved ones. 
• Compare prices. You can do this by flipping through the advertisements crowding your inbox or searching the Internet for the best deals.  When you shop, bring competitor ads along.
• Take advantage of credit card awards.  See if you have enough points for a free flight home, or enough points to cover gift expenses.
• Dig up unused gift cards. You may have a stack of forgotten gift cards in your wallet that you should use before they expire. 

See Deborah Jian Lee, 15 Ways to Avoid Holiday Debt, Forbes, Nov. 26, 2014.