Moving the calendar along into the holiday season is enough to make your head spin isn’t it? Current data shows the average parent spends more than $400 on each person in the household for Christmas alone. That doesn’t include wrapping and decorating supplies, holiday meals, travel and other seasonal expenses.
If it typically takes you a year or more to pay off your holiday debt, you are definitely not alone in the struggle. If, like many other Tennessee residents, you use your credit card for holiday shopping, you may wind up paying $100 or more in interest by the time you pay off the entire debt. This represents just one of many reasons holiday debt often leads to bankruptcy.
Avoid common errors
No one is saying you must spend zero money on the holidays this year, although what you don’t spend can’t come back to haunt you. Less is definitely more in terms of spending and saving money. It’s understandable you’ll want to spend some money, however, as you host parties or visit family and friends from now through the end of the year. The following list includes spending mistakes many people make that you may want to avoid if your goal is to make it through the holidays without incurring substantial debt:
- An emergency fund is supposed to be for emergencies, so you should probably ask yourself whether you could truly consider buying your co-workers gifts or taking a holiday trip to go skiing urgent events. It might be best to leave the emergency nest egg untouched during the holidays.
- A big mistake many people make when they run short on holiday spending cash is to tap into their retirement funds. This is something you might later regret if you do it.
- Don’t carry more cash than you’ve allowed in your holiday shopping budget. If you do, you may be tempted to overspend.
- It truly is the thought that counts, so if this year is a particularly challenging one for you in a financial sense, perhaps you can think of other ways to let your friends and family know you are thinking of them, such as hosting a small get together with hot cocoa and homemade treats.
It is quite possible that you might employ one or more of these cost-saving ideas during the holidays and still wind up in a serious financial crisis because so many other issues factor into the overall situation. If your boss decides not to handout holiday bonuses this year, for instance, or someone falls ill and needs to go to the emergency room, such unexpected events may be enough to tip your financial scales way off balance.
Options are available
No matter what time of year it happens to be, if you run into serious money problems, try to remain calm and explore all options available to help you get things back on track. Numerous types of bankruptcy cannot only help resolve temporary financial problems, but can also help lay the groundwork for a stronger financial future.