KANSAS CITY, Mo. – From groceries to gifts, the holidays tend to be the most expensive season of the year. And 2018 is lining up to be even more costly. The National Retail Federation estimates consumers will spend about 4 percent more this year compared to last.
But consumers can make the pinch of all that money leaving their bank accounts hurt a little less. Money Smart KC offers these suggestions for holiday spending.
– Plan ahead.Sarah Cousineau at Central Bank of Kansas City stressed the importance of creating a budget. “People don't like that word. It's like diet. They're like ah! If you have a plan [you can prepare],” she said.
Even with just a little more than a month before Christmas, a budgeted approach can make a difference. Most people will receive three more paychecks before Christmas. Now’s the time to do the math: How much money do you anticipate spending? Divide that number by three and take that much out of each of your next three paychecks. Cousineau said that will help you deliver Christmas without a big impact on your wallet.
– Start thinking about next year. Money Smart KC suggests saving all your receipts from now until the end of the year. Once the holidays wrap up, add together all receipts on groceries, gifts and gas. The total will be a baseline of how much you spent this year, and you can start planning in January for next holiday season.
– Set expectations. Cousineau said she is up front with her daughters about how much she can spend on gifts around the holidays.
“If they ask for something, I may say that is over budget, or this may be the only thing you get. That type of thing. Set expectations for what you can really afford. We all can't live like Beyoncé and these stars. You have to be realistic on what you can afford,” Cousineau said.
– Avoid impulse buys. Make a list before you go shopping. Cousineau said that helps you stay focused. If you find something you want, leave it on the shelf, finish your shopping and then revisit it. That pause may help you realize you don’t need to follow your initial impulse.
– Don’t open new credit accounts. Cousineau advises not applying for credit cards when department stores offer you savings for opening a new account. She said abusing lines of credit can hurt your credit score. She also said interest can add up quickly if you don’t pay your balance each month.
– Shop for bargains. Sales and Black Friday deals may not always be as good as advertised. Shoppers can compare prices online from home or download apps such as Slickdeals to find where to save money.