These five financial tips will destress your holiday season.

Some of the year’s biggest shopping days are right around the corner, starting with Singles Day on 11/11, when giant retailer Alibaba broke records last year with sales of US$25 billion. Despite all the deals, the holiday season can be treacherous for your wallet. Do you want to be generous with your friends and family and treat yourself, too? Have you been saving up for the holiday shopping spree? We have some financial tips to help.

1. Set financial goals for the holidays.

You’ve heard the cliché about looking ahead: Failing to plan is planning to fail. If you don’t know where you’re going, you’ll end up somewhere else. They apply to your finances, too—both to the big picture and to the small stuff.

Start by figuring out what’s most important to you. Do you have lots of family members who all expect extravagant gifts? If their expectations don’t match your budget, maybe you can find a gift that expresses how you feel without bankrupting you, like organizing a fun family event. If you’re dating seriously, does your significant other expect more than you can give, or vice versa?

Don’t start the season without a holiday spending plan. Take some time right now, even just a half hour, to review your budget. (You do have a budget, right?) Look at what you’ve spent so far this year. Do you have extra cash? Great! Decide how much you want to spend on the holidays. Coming up short? See more tips below for ideas about how to make your holiday dollars go further. Knowing what’s important to you and what you can afford makes decisions about what to buy much easier—and ensures that you will emerge from the holiday season with money left in the bank!

2. Pick days or blocks of time when you won’t shop or spend money.

Making certain days off-limits for shopping helps put a lid on how much you will spend. Get out your calendar and circle the days that are okay to spend. On the days you plan not to spend, stay away from the mall and don’t open your favorite shopping app. If you feel tempted, create a list instead that you can use when your next shopping day arrives—and prioritize it.

Consider removing your saved credit card information and disabling one-click ordering if those are options on the shopping sites you use. That way, if you want to purchase something, you’ll have to go through more steps to complete the purchase. You’ll have to work extra hard to buy something if you’re tempted to shop on a no-shopping day.

3. Set budgets for each holiday.

There’s no doubt that you can get great deals on days when merchants mark down items to attract customers around particular holidays, like Singles Day in Asia; Thanksgiving/Black Friday/CyberMonday, small-business Saturday, and post-Christmas in the U.S; and post-Boxing Day in the U.K., Canada, and Australia.

But if you start shopping without a plan, you could end up blowing your budget in the first hour. Go back to Tip #1—planning—and review your budget for each holiday. Who’s on your list? What types of gifts will you buy? What are they likely to cost? Where will you find the money?

And, as this article in U.S. News points out, timing is everything. If you create a budget at the beginning of the year, you can take advantage of deals year-round.

4. Cut spending on other things to save for holiday shopping.

If purchasing that $200 sweater for your best girlfriend or the fancy cologne for your dad is important to you but you don’t have the money in your budget, see if you can shift some priorities around the holidays. Maybe you can give up a few dinners out or skip that new pair of shoes for yourself. Again, it’s about knowing yourself and what’s important to you.

5. Use caution when spending money you don’t have.

Many millennials and younger consumers are shunning credit cards because they saw their parents struggle with debt during the financial crisis. That doesn’t mean they might not need to borrow money. Merchants are responding with point-of-sale (POS) lending—basically an instant loan at the time you pay for an item. POS lending is a form of installment loan that has the benefit of letting you know exactly how much you owe in both principal and interest and when you need to pay it off.
But you’re still using money you don’t have to pay for something.
Borrowing may be necessary for big purchases like a home or college tuition and even for items like major appliances or construction projects. But be wary of using a credit card for small items, unless you have the discipline to pay off your credit card bill in full every month. And keep an eye on the cost of POS lending, which can drive up the cost of an item because you’ll be paying interest on it.
Instead of relying on credit to finance your holiday spending, use some of the strategies mentioned above. Better yet, plan in advance for next year by building holiday spending into your budget at the beginning of the year. That way you’ll have plenty of time to save for must-have items when gift-giving season rolls around.

Be a smarter buyer

The holiday season can be the best time to find deals, making it an ideal time to spend—if you have a plan! For next year, create a budget, know what to buy and when, and take advantage of the awesome deals you know are coming around the holidays.
Please share these financial tips with your family and friends! They’ll thank you when they can relax and start the new year on financially firm ground.

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