The holiday season is fast approaching. Just as it’s easy to overeat during the holidays, it’s easy to overspend, especially if you buy on credit. Research shows that people spend about 15 percent more on purchases paid with a credit card. (So easy when you can just swipe and forget about a purchase.)
To help you through the holiday rush and keep your spirits bright, here are seven tips to help you afford the holiday, and save taxes to boot – now there’s a real gift!
1. Make a gift-giving budget and stick to it
Isn’t it time to get sane about holiday spending? Before you go shopping, make a budget. Write down the total amount you want to spend on gifts and then break it down by person. This can help you decide whether to get your mom that expensive pearl necklace or those less expensive pearl earrings (or maybe just write her a heartfelt card).
2. Decorate on the cheap
A trip through Costco during the holidays will show clearly that it’s easy to spend hundreds of dollars on neat holiday decorations. Instead of splurging on holiday knickknacks, use your ingenuity. Bundle pine boughs to capture the scent of the holidays, or buy wide velvet ribbon and tie bows on everything from doorknobs and banisters to candlesticks. Pinterest is an excellent resource for gorgeous, homemade crafts.
3. Give from the heart and hearth
Happy memories come from special times, not from spending a lot of money at holiday time. Bake bread, knit a scarf, or make a personalized scrapbook. A handmade gift or baked goods tells the recipient you invested time (not to mention love) in the gift – and that makes it priceless!
4. Gift wisely
You are spending your hard-earned cash, so be sure that the recipient is getting something they value. It doesn’t always work that way, you know — 42% of consumers still have at least one unused holiday gift from last year in the back of their closet, and 28% admitted to re-gifting at least one of their holiday gifts from last year. And speaking of closets…
5. Clean out your closets
Donate old clothes, sporting goods, books, and other household goods that you no longer use. You will welcome the New Year with new space in your life, and get a quick tax deduction to boot. It also just feels good to give to those in need. Document these donations by making a list of the items at the time you donate them, so you can compute the value of your donation.
6. Prepare for next year right after the holiday
Buy all of your holiday decorations, gift wrap, and cards for next year at this year’s post-holiday sales. You can easily find deals for 50% off or more on items that were full priced a week ago. And after paying off this year’s bills, put aside $50 to $100 a month for next year’s holiday presents. You’ll emerge from next year’s holiday rush debt-free. And while you are preparing for next year…
7. Do a rough calculation of your taxes for this year now
Use last year’s tax software to estimate this year’s taxes, or note your new numbers in the margin of last year’s tax return and use last year’s tax rates as a rough approximation. The IRS treats income taxes withheld from your paycheck as if they were paid in equal amounts throughout the year. So if your calculations show you’ll owe money, you can increase the withholding on your last paychecks of the year to make up the difference. (Here’s a great article on how to prepare for tax time.)
Above all, remember to enjoy the holidays. Don’t stress yourself, spend yourself into debt, or spread yourself too thin trying to create the perfect celebration. Memories make themselves when you cherish time with friends and family!
Finally, if one of your New Year’s resolutions is to get on top of your credit card debt, save up for a down payment, or learn to invest in the stock market, consider starting a Money Club
Perfect list of practical holiday, money saving tips … and we don’t need the stuff anyways (http://www.hometips4women.com/thanksgiving-is-about-giving-not-shopping)