(WXYZ) - The holiday season will be here before you know it and a new survey shows 58 percent of Americans are concerned about the cost of holiday shopping.
Last year the average American spent about $630 on gifts and another $200 more on holiday related spending. That’s a lot of money, and with the economy what it is, seven’s on your side to prevent the holidays from sending you deeper into debt.
John Powell and his wife are already setting up their holiday budget. They’re new to our area. His wife has a job, but John is unemployed.
“On one salary, two kids in college, a mortgage and we’re renting here, it will be leaner,” John says of the upcoming Christmas season.
Robin Thompson runs
Budget Wise Consulting.
“The first thing you want to do in terms of budgeting and saving for the holidays is to decide that you want a cash only holiday season,” Thompon says.
She says you’ll spend less when you take credit out of the equation, and it prevents a holiday hangover. Surveys show a quarter of all Americans take 12 months to pay off their holiday purchases when they’re put on credit.
Some of the nation’s largest retailers like
Sears and
Kmart offer holiday club accounts that let you save without tapping your credit cards. Open a club account with just 5 dollars and for every dollar you set aside, the stores will give you a three percent match on your total as of November 14th. (A maximum of a $100 match) Of course, you have to spend the money at that store.
Many banks and credit unions offer holiday accounts too. Money is automatically pulled from your checking or savings account on a periodic basis and put into your holiday account.
Think you can’t pull off cash only?
“You may actually find you have more to spend by trimming some of your current expenses. Eating out always seems to top the list, but what are some other conveniences that you could give up in the next couple of months?” Thompson says.
Be sure to make a detailed list of everyone you buy for and everything else holiday related… travel expenses, gift wrapping and holiday cards. Then take your budget and divvy it up, and start looking for sales. They’re already out there. If you’re looking for toys, Target has already cut prices on top toys like Barbie and G-I Joe by 50 percent. Walmart is selling Transformers and other toys for $10 bucks or less, and KMart is offering some of its popular toys for $11 dollars.
If you need to cut back this year, Robin thinks being honest with the kids is important.
“Then you can also help them understand that there may be people who don’t have as much as they do and you could do other things such as take them to a shelter or teach them to volunteer during this time so they can see how fortunate they really are,” Thompson says.
That way they learn the holiday season is about so much more than what we buy!
Click on the link above for a worksheet to help you budget for the holidays!
