By KATHY SMITH
Stretching personal financial resources to cover holiday expenses can challenge even the best money managers.
In addition to the pressure to buy gifts, food and entertaining expenses, decorations, wrapping paper, cards, postage and travel all can require expenditures over and above typical monthly expenses.
While making your list and checking it twice might seem more like Scrooge than Santa, the good news is that most people can trim some holiday expenses and also improve their money management skills, even during the holiday season.
To begin, ask yourself: What can I do to make the holiday season less stressful? What’s most important? And, what can I eliminate?
To help answer these questions, here are some tips:
• Make a list of family and friends for whom you plan to buy gifts. Jot down some gift ideas and a price range for each gift.
• Shopping with a list and a pre-determined price range can reduce the temptation to overspend.
• Now, take a look at your finances. Have you saved for holiday expenses? Or, will the gifts need to be purchased from regular monthly disposable income? Do you plan to pay cash? Or use credit? Using credit can be a good choice, particularly if you can pay off the credit card at the end of the month. Purchases made with a credit card can be easier to return or exchange, but overspending – charging more than you can afford to pay – can commit future earnings and also raise the price of purchases that are not paid promptly.
• To manage credit, make it a habit to monitor your spending. Carry a piece of paper or an envelope in your wallet and record purchases. The advantage to a small envelope is that you can tuck receipts inside.
• Plan to pay with a check or debit card? Be sure to deduct the amount of the purchase. With cash, be careful and watch your wallet or purse carefully.
• Right time to shop? Some people like to have their shopping done early in the season, while others seem to thrive on the holiday atmosphere. Both can offer advantages.
• Early shoppers may have more to choose from, but late shoppers may be able to take advantage or early sales or price reductions.
• Plan now for next year. If you have storage space and the funds available, take advantage of holiday sales to purchase decorations, gift wrap, cards and perhaps even some gifts for next year.