Although the holidays should be a joyous time spent with friends and family, they can often be filled with unnecessary stress and financial hardships. A recent survey found that the average Albertan will spend $622 on holiday shopping this season, with only 26 per cent intending to stick to a firm budget. With door-crashers like Black Friday and Cyber Monday becoming increasingly popular, Canadians are spending more time than ever shopping in store and online. To avoid the dreaded financial aftermath of holiday shopping, try following these proactive tips:
Don't exceed your spending limit
- Create a personalized budget that's tailored to your unique financial situation and stick to it as closely as possible to avoid unexpected bills.
- If you're not sure how much you should actually spend on holiday shopping, you can start by following the rule of thumb for middle-class Canadians, which is to limit yourself to one per cent of your pre-tax income.
Make a list and stick to it
- Write down the names of all the people you want to purchase gifts for. Be critical when deciding how much of your budget you want to spend on each person.
- If you find a great bargain, replace it with an item already on your list. Otherwise you won't actually get the benefit of the bargain; you'll really only be purchasing an additional item.
Use cash or debit instead of credit
- If possible, avoid using your credit card to purchase gifts. Credit card purchases are often difficult to keep track of, which puts you at a higher risk of spending above your means. You'll be glad you didn't go overboard when January rolls around and you don't receive a huge credit card bill.
- Shopping at discount stores will help you get the most out of your holiday budget without breaking the bank.
- Certain items are more affordable at different times of the year, so plan ahead, do your research and browse deals all year round.
- If you're an avid online shopper, don't always count on Amazon to have the best prices. Consider browsing other online stores as well.
- Christmas is about giving, not buying. If you have the time, consider crafting DIY Christmas gifts instead of buying mass-produced items.
These tips are intended to help shoppers avoid the burden of holiday debt, but they may not be applicable to everyone.
We hope that everyone enjoys their holiday preparations in the coming weeks!