01Avoid Debt by Saving in Advance for the Holidays
Along with good cheer, the holidays bring so many expenses--Christmas parties, travel, decorations and groceries. Without a holiday budget this can get out of hand because all that is on top of holiday gifts, of course! No wonder many Americans sink further into debt during the holidays.
This year set a holiday budget and savings goal and get started saving for Christmas as early as possible. By setting a holiday budget and paying upfront, you avoid that post-holiday credit card hangover. The earlier you start, the bigger the nest egg. And by avoiding holiday debt, these can strategies work with your long-term goal of building your savings.
These six savings strategies can help you save for the holidays and avoid holiday debt.
02Set up a Holiday Savings Account
Have part of your paycheck direct deposited into a separate savings account that is solely for the purpose of saving for the holidays. Or, if you don't get regular paychecks, set up an automatic transfer to the savings account. If you are a born spender, take extra precautions to keep yourself from breaking into your piggy bank prematurely.
Don't get an ATM card with your savings account. A trip to the bank will slow any impulse withdraws. Or, consider joining a "Christmas Club." Some banks still offer these old-fashioned accounts in which an automatic deposit accumulates over the year and the bank cuts you a check in November.
03Make Extra Money During the Holiday Season
In my book, more money coming is a better solution than less money going out, so I'm adding some ways to make money during the holiday season. We can be so busy during than the holidays though that it can be tough to make more money but everyone is busy so there are more people willing to pay for your services. Holiday seasonal call center jobs from home could bring in some significant income or these 9 apps for making money with your phone can help you earn a little extra cash while doing things you would do anyway (like shopping).
04Re-Examine Your Budget and Expenses
While we tend to think that the price of anything only goes up, that isn't always true. If you shop around for services that you pay for you will see that sometimes they actually go down! Read these 10 ways to cut your monthly budget and if you can save a few dollars every month put that away into a holiday fund.
Giving up one of your little luxuries in order to buy a gift for someone else is a noble gesture. Set aside what you would spend on your daily latte or Friday night pizza or something that you're much better off without anyway, like cigarettes. This strategy may be best left for the last few months before the holidays because you may not want to give up your little indulgence forever (unless it's smoking!).
The most practical way to recoup this cash is to calculate how much you spend on this item, and then deposit that amount into your holiday fund in advance, preferably on a weekly basis.
06Bank Money You Are Owed As It's Repaid
We often don't think too much about the little sums of money we are owed by various sources until the cash lands in our hands. Resist the urge to spend this money and instead make a habit of saving rebates from retailers (even if they are only a few dollars), refunds from utilities or insurance companies, reimbursements for expenses, repayment of other debts and other unexpected windfalls.
For self-employed work-at-home moms, this strategy can be applied to payments for unexpected jobs. Or even resolve to set aside all the income from one client.
07Count Your pennies…Literally
Empty your pockets or purse daily into a change jar. Use collected change to start your holiday fund. If you use a change counting machine, you'll pay a commission. Instead, let the kids roll it and pay them the commission. It will keep them busy, and give them extra spending money for the holidays (something they might ask for anyway!).
To increase savings, don't hand over a penny when the total ends in $.01. Take the $.99 and add it to your jar. If you make cash withdraws on a regular basis--every payday or each weekend--add any leftover cash at withdrawal time to your change collection.