How to Avoid the Post Festive Season Debt

For many of us, holiday debt is just a part of the festive season. We’re so conditioned to just “putting it on the credit card” that we often don’t realise how much debt we’ve actually created for ourselves until it comes to receiving our January credit card statement.

Lingering debt can cause havoc on your family finances, yet we still get caught up in the emotional tug of buying multiple gifts for family and friends.

Fortunately, the festive season doesn’t have to end in crippling debt. A healthy mix of restraint and savvy shopping can help bring you into the new year, sans debt.

So, what can you do when you’re usually in a good financial shape, but you’re facing the financial obligation of the holiday season?

SET A BUDGET

It sounds so simple, but we all know that when we get into the shopping centre at Christmas time, budgets can go out the window!

Look at your savings and figure out exactly how much you can afford to spend this season, then make a specific list of what you will buy each recipient and how much it will cost.

It’s also a good idea to set a budget, not just for gifts, but for things like travel, food, accommodation etc. The holiday period doesn’t just comprise of gift giving, so be aware of the other activities that come along with the season.

PLAN AHEAD WITH YOUR FAMILY

If finances are extra tight this year, then have a conversation with your family about your options. Some years you may want to buy everyone a present, and others, you might want to do a “Secret Santa” where you only buy one person in your family a gift or do a gift exchange.

Other things you can do to manage your finances are to set a budget with your family on how much each person will spend, or focus on meaningful gifts over pricey, gimmicky gifts that seem to pop up over the season.

GET ONLINE

It’s not often that we advocate for online shopping, but around the festive season, getting all your gifts online can mean unnecessary trips to the shopping centre, where you’re more likely to overspend on things you don’t need. It also means that you can avoid the masses and traffic chaos that come with Christmas shopping at a shopping centre.

COMPARE PRICES

Don’t just buy the first thing you see! With plenty of retailers luring shoppers over Christmas, it’s worth shopping around to see if you’re getting the best deal. If you’re shopping online, ensure you take in to account things like shipping costs – as this can make all the difference between a bargain and a splurge.

TAKE ADVANTAGE OF POINTS AND REWARDS

If you’re a regular user of your credit card, then it’s likely that you’ll have some points up your sleeve to use toward Christmas gifts. Some credit cards even provide discounts to major retailers over the holiday season, so check these first before you head out to purchase.

CUT DOWN IN OTHER AREAS

We all know that the holiday season can come with a big price tag, so leading up to it, why not try and make some cuts in other areas? Get creative and start thinking about how you can save that little bit extra before Christmas time. Aussies are blessed with beautiful weather coming into the holiday season, so make the most of it by doing free outdoor activities, or opting for a BBQ at home, rather than a night out at a fancy restaurant.

While the holiday season is definitely a time to be able to treat yourself, it doesn’t mean that it should put you into a stressful position financially. Start your new year off on the right foot and be conscious when it comes to holiday spending.