Because your family often forgets that money doesn't grow on trees, MoneyTree is here for you.
This holiday-shopping season is indeed one for the bargain hunter. Here are four spending tips to help keep you ahead of the pack.
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No. 1: Make a Realistic Budget … and Stick to It
Experts say one of the most common mistakes made when it comes to holiday shopping has to do with your budget. Not only should you make a budget, but you should also make sure it is realistic.
Make the usual list for the people you need to buy gifts for and how much you are willing to spend per gift, but also remember to add in the “extras.” For example, budget in hostess gifts for any scheduled holiday parties, and also consider the extra groceries you’ll need to stock up on ahead of family visits.
And spend within your means. Your family would rather enjoy your company than have you give them something they don’t need that you’ll be paying for for many holidays to come.
The average family will ring up just under $1,000 this season, according to Mike Peterson, spokesperson for American Credit Foundation and president of Debtguru.com. At current interest rates, it would take 22 years to pay off that balance if you are only making the minimum payment each month, Peterson said. That’s a long time.
“No one wants to accept a gift that puts you in debt,” he said.
Jennifer Jolly, a consumer lifestyle expert, says bloated cell-phone and gas bills are another holiday-budget breaker.
“Cell phone bills tend to catch people off guard, you make more calls and texts during the holiday season than normal and they can add up if you go over your minutes,” she said.
Save on gas by doing all your price comparison and window shopping online and then make one trip to pick up gifts, Jolly advised.
And don’t forget your list.
“If you walk into a store without a list, 9 out of 10 times you will spend more than you anticipated,” said Peterson. Impulse items will become tempting and it’s harder to say no when you don’t have a list to check.
No. 2: Shop Alone
The more the merrier? Not when it comes to shopping. It’s better to fly solo to the mall, said Bill Losey, a certified financial planner and author of "Retire in a Weekend.”
“When you go with other people, even if it’s a spouse, you get caught up in the experience of shopping and things are no longer black and white, you don’t want to be influenced by any one else.”
No. 3: Don’t Wait Until the Last Minute
Maybe more than ever, this year bargain seekers don’t have to wait until the final days before Christmas to find the biggest steals.
“It’s an old-fashion thought for this year,” said Jolly. “Retailers had more stock last year, but they smartened up and have a lot less inventory [this year], they are trying to spark a big buying frenzy right now.”
And waiting until the last hour could actually end up costing you more.
“You can’t assume things are going to go on sale right before the big day, you need to have a back-up plan, because people are left with little options and spend more money on a gift than allotted,” Peterson said.
No. 4: In Tight Times, Skip Decorations with a Lifespan
In this economic environment, buying a Poinsettia is just silly, according to Jolly.
“Any money you spend on something that is going to die a couple weeks is just like throwing money away,” she said.
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