Holiday Budget Planning Tips
Organizing Your Holiday Budget
Money Saving Recession Holiday Tips - What You Need to Know This Holiday Season
By Mick Bernard
With the current recession, consumers are thinking about ways to cut costs, and save money while still maintaining some sense of normality. This difficulty becomes most apparent during the holiday season, when generous spirits and a desire to buy the best gifts conflict with the realities of a diminished budget.
According to a recent survey from PriceGrabber.com, 75% of shoppers are more concerned about holiday gift giving this year than they were in previous years. According to the same survey, only 41% of respondents said they plan to start saving for the holidays earlier than last year and 36% admitted that they don't save up for the holidays at all.
Retailers are also worried about the upcoming holiday season. Last year's sales were down by more than 2%, according to the International Council of Shopping Centers. A drop in November sales of 2.7% and an additional drop in sales in December of 1.7% added up to the largest industry decline since 1970. With consumers worried about rising gas prices, falling housing values and disappearing jobs, this year might just decline even more sharply this year.
So the question remains: how can concerned consumers ensure the holidays don't wreck their newly created sense of frugality or newly tightened budgets. Experts recommend you move to an "all cash" holiday.
•Create a budget: How much money will you spend on gifts? Decorations? Special events? Build a budget based on last year's expenses, credit card receipts and big purchases. Prioritize expenses, figure out what you can afford to part with and where you can cut down on costs. Then, stick to your new holiday budget. •Start saving now- Based on your newly created budget, start saving. Set up an automatic deposit of a fixed amount from your paychecks into a savings account, keeping that money off-limits except for holiday expenses like plane tickets, gifts or decorations. The sooner you start saving, the smaller the monthly amounts you will need to set aside. •Start buying now- Items your family members want may be available at a lower price earlier in the year. End of season clearance sales are excellent opportunities to purchase non-perishable items, like clothes and appliances. Items are more likely to be in stock and with greater options than later in the winter. •Avoid plastic- When shopping for gifts, withdraw cash from your savings account and pay with it. Using credit cards makes the act of spending money less immediate, which makes it easier to overspend. Using cash creates a more direct sense of spending money and makes the amount you are spending more real. Plus, you are less likely to wrack up debt if you only spend the money you have already deposited in your special holiday savings account. •Get creative: Instead of buying new decorations, make them. Instead of buying new gifts, hand down family heirlooms or make old objects new; frame photos, refinish old furniture, or stencil designs on an old mirror. The memories you make of stringing popcorn and cranberries for the tree or frosting cookies to give to your neighbors will quickly replace any stress from cutting back. •Talk to family and friends: Instead of buying gifts for each co-worker, plan a Secret Santa or White Elephant gift exchange. Lower children's holiday expectations and explain how the number of gifts might be lower, but that doesn't affect the spirit of joy and love for the holiday. Consider buying one large gift that the entire family can enjoy, like a new TV, instead of individual gifts for each and from each family member.
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About the Author:
Mick is a Certified Credit Restoration Expert and President of Credit Strategies, a credit consulting firm in Scottsdale, Arizona. Credit Strategies works with consumers with less than perfect credit increase their credit scores so they can qualify for the best possible financing. Find us online at http://www.onlinecreditstrategies.com
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