During the holiday season, there are a copious number of enticing deals from retailers that can be difficult to resist. It seems that everywhere you go, posters are screaming “SALE, SALE, SALE,” with very little reprieve until after December 25th. But, just when you thought it was safe to go back out to your local mall or shopping center, the post-holiday sales begin and your will power is tested yet again.
Resisting the urge to buy things you do not need is a difficult proposition during the holiday sales season. However, self-control in this area can go a long way in helping you keep your finances in order, pay off interest-bearing debt, maintain a healthy savings account and perhaps even save enough for a down payment on that dream home.
Here are some tips that we have found to be helpful for keeping your finances in order during the holiday season.
1. Use Cash Only – Challenge yourself to not shop with a credit card. When you’re limited to cash or a debit card, you’re much more likely to purchase only what you can afford. There is plenty of research out there that shows people tend to spend more when they charge things on a credit card.
2. Ask Whether Paying Triple the Price is Worth It – If your purchase is put on a credit card at 21% interest and you can only pay the minimum payment at the end of the month, by the time you have fully paid off that purchase it could cost you triple. So, if you’re buying a $50 sweater, look at that sweater and know that, in your situation, it may just cost you $150. Is all that riba/interest really worth it?
3. Eliminate Emotionally Driven Shopping – Guilt, panic or a mob mentality can make for an expensive combination. Short-term sales create an emotionally charged situation. Whether it’s Black Friday, a weekend special or the post-holiday sales, the fear of “missing out” can override our common sense. Avoid this situation by always keeping a shopping list of items you really need and be sure to prioritize. If you’re shopping online, wait at least 20 minutes after you place something in your shopping cart.
4. Trust Your Instincts – Whenever you feel fear about spending money, that should be a sign that you’re spending money you don’t have. What’s worse, is that you might be spending money to impress people you don’t even know or like. Try asking yourself, do I need this item or do I just want this item?
While it’s not an easy feat, you can avoid overspending this holiday season. Practicing these tips can ensure you’re off to a good start.