During November and December, spending habits tend to increase to account for the holidays. Buying gifts, traveling to see family and friends, and buying decorations all add up to the most expensive holiday for most. Whether you’re trying to budget to avoid debt or already in debt, here are some tips to make it through the holiday season without growing what you owe significantly.
Many people tend to create budgets in January that they want to abide by for the year. Whether it’s a New Year’s Resolution or in preparation for tax season, sticking to a budget is always a good idea. If you don’t find yourself overspending throughout the year, consider budgeting for the holidays specifically. Base your budget around what decorations you may need to buy new, like a live Christmas tree, who all you will be buying gifts for, any travel expenses you may have, and set a strict spending limit. Based on expected spending, it’s always wise to account for unforeseen expenses so you are able to avoid going into debt for them. A great way to start saving money and prepare for this higher spending season is to create a savings account specifically for these future expenses.
However you store your savings, consider adding a holiday savings account . The increased expenses are best handled in advance through saving for the situation. Consider putting a small amount into this account from each paycheck or whenever you have any extra money lying around. Ideally, this account will have interest that will help expand your savings throughout the year. This helps you to save overtime, making the increased spending less stressful.
Have a credit card or two? Do you know your credit limits and rewards? Now is the time to check both of those things out. Different companies run deals, offer cashback, and have rewards based on your spending habits on their cards. You may have travel credit to put toward a trip or hotel stay for the holidays. The holidays are also a great time to take advantage of cash back on purchases and put that cash toward your expenses. By knowing your credit card limit and rewards, you can take advantage of holiday sales and stay on budget. One important thing to remember with credit card purchases is that you will have to pay them off—the sooner the better. Only spend what you can afford based on your budget so you avoid accumulating insurmountable debt.
If you’ve accumulated various debts, whether from previous holidays or general life expenses, now is not the time to brush it off and keep going. Seek guidance from an accountant to plan out a way to pay off your debt before it reaches the point of needing a bankruptcy attorney near you.
Have questions regarding what to do if you’re considering filing for bankruptcy due to holiday debt? Contact us at The Law Office of Corey Beck in Las Vegas for lawyers you can rely on year-round.
