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Try These 12 Things To Avoid Holiday Overspending

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This time of year can be stressful for a lot of people, particularly when it comes to money. Some 40% of Americans feel pressured to overspend during the holidays, according to a recent survey by Harris Poll on behalf of SunTrust Banks. And among parents with children under age 18, a hefty 53% feel pushed to spend more than they can afford. That kind of stress can be a first class ticket to credit card debt. “The holiday season can overtake us—and our wallets—if we aren’t making good financial decisions from the beginning,” says Rilla Delorier, SunTrust’s consumer channels executive.

Here’s how to dial down the spending drama:

Set limits. “An overall budget is helpful, but a budget for each person on your list is even better,” says Kimberly Goodwin, associate professor of finance and Parham Bridges Chair of Real Estate at the University of Southern Mississippi. “Force yourself to find gifts that fit within the amount budgeted for each person. If you need even more discipline, you can make an envelope for each person and put your budgeted amount inside as cash.”

Track your gift giving. Hilary Hendershott, a financial planner in San Jose, CA, keeps a spreadsheet with a list of past giftees and how much she’s spent or is spending. With this method, she can keep dollar amounts in line with previous years’ giving, and it helps her spend less. “If I put dollar amount estimates in the spreadsheet for all of my gift recipients, it acts like a mini-budget,” she says. “If I splurge somewhere, I have to cut somewhere else.”

Set your own expectations. “Give what you can afford,” says Kevin Gallegos, vice president of Phoenix operations for Financial Freedom Network. “Do not give what your mother believes she deserves, a gift equal to what your sister-in-law gave you last year, or whatever unrealistic measure might be luring you toward overspending.” Your loved ones would not want you to suffer financially to give them more presents, right? Of course not.

Have a chat. “Talk to your family and friends before the holidays about holiday traditions,” says Teresa Mears, editor-in-chief of LivingOnTheCheap.com. “Maybe your friends would really rather go out to dinner in January. Or maybe they’ll be relieved that the obligatory gift-giving can end.”

Do some forward thinking. “If you start to feel impulsive and tempted to spend more than you can afford, remind yourself that the end of the year does not mean that you start with a clean slate in January,” says Michael Cunningham, Ph.D., a social and personality psychologist in the communication department of the University of Louisville. “Visualize how you will feel when you open a credit card statement and see a staggering number.”

Seek out free community entertainment. Tickets to big-budget productions can add up quickly. “Instead, check out the schedules at local schools or faith-based organizations for a more budget and family friendly production to enjoy,” Gallegos says. “You’ll reap the joy of holiday entertainment without the pressure to spend big on tickets. And you may find a favorite and start a new tradition.”

Weigh the cost of gift cards. “Gift cards may offer flexibility, but they can also cost more than choosing a present,” says John Bucsek, managing director at MetLife Solutions Group in Cranford, N.J. “Weigh your options to see which strategy provides a more cost-effective gift.”

Ditch the token presents. “Resist the urge to pick up a ‘small gift’ for people you’re not really close to,” Mears says. “They probably don’t need more stuff. If you want to show your appreciation, write a heart-felt note.”

Say no to impulse buys. “Even if it is a gift you think someone will love, don’t buy it on the spot,” says Jeff Hunter, editor-in-chief of SimpleThriftyLiving.com. “Go home, do some comparison shopping, and make sure you’re getting the best price for it. Giving yourself that time will not only land you a better price but will also give you time to think through the purchase and make sure it’s the right gift.”

Travel less and lightly. Just because you’ve always schlepped your family of four to your sister’s house doesn’t mean you have to keep doing it. “We tend to gravitate toward our families and close friends during the holidays, but some people may not find themselves in the position to make a trip this time of year,” Bucsek says. “Work together to create a travel plan that suits everyone’s needs, and when it comes time to make the journey, pack lightly and efficiently to avoid extra fees.”

Think homemade. Giving a gift you made yourself doesn’t have to mean learning how to knit or bake breads. (Although you could.) “I infuse my own organic vodka with fresh ingredients, everything from vanilla bean to pineapple to chili pepper,” says Elle Kaplan, CEO and founder of LexION Capital Management in New York City. “A homemade gift shows the recipient that you not only thought of them, but gave the gift of time to create something unique and personal.”

Brian Frederick, a financial planner in Scottsdale, AZ, agrees. “My father-in-law makes this wonderful raspberry jam, and to me, I’d rather have that than a lot of other things.”

Set up a holiday savings account. This won’t help you this year, but next year you’ll be delighted you did it. Set up a dedicated account and have a little money transferred to it automatically on every payday, or once a month. It’s far easier to part with $100 a month than to come up with an extra $1,000 in December. “When Christmas comes around, I can happily empty the account to buy gifts for people I love,” Hendershott says. “This will take a year of planning, but it’s so nice to have drama- and stress-free holidays.”

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