In 2011 the average American family spent $646 on Christmas gifts according to the American Research Group, Inc. While that number may not shock wizened shopping veterans, maybe this one will: the average American family is expected to spend $854 in 2012, according to the same group. The driving force behind the increase in spending is thought to be the end of the recession that began in 2008. After years of getting by, many people are expected to spend more freely this year. Here are a few ways to avoid becoming a part of the spend-free stat.
This is a major way to control your Christmas spending. Personally, I have ten nieces and nephews, their parents, my parents and their spouses. It wouldn’t take long to accumulate enough credit card debt to choke a horse buying for everyone. I limit my purchase to my children only. Your situation is different, but you get the idea. Be sure to send cards and make phone calls to everyone else, but keep the buying to a narrow group during the holidays.
Ah, the dreaded budget-within-a-budget. Set a dollar limit per person. Let your income be your guide here. For me, it is $50 per child. Whatever dollar amount you set, the key is to stick to it. You do not want to be the person who struggles all through 2013 to pay off Christmas 2012.
The problem many of us face at Christmas is a lack of planning earlier in the year. Buying Christmas gifts would be much less of a struggle if we saved all year. Why not make this the year that you open a Christmas savings account? For as little as $10 you can open the account. Committing a paltry $5 a week could help you stick to your monthly budget and keep your credit card in your pocket during the next holiday season.
The bottom line is that many people get caught up in the Christmas hype and spend more than they can afford. Don’t fall into that trap. Create a budget, open a Christmas account, and stick to your goals this season. Happy Holidays.