Consumers need not stress over busting their piggy banks when shopping for holiday gifts.
Local financial experts recommend making a budget and offer other money-management tips that can help ease the pain in residents’ pocketbooks come January 2014.
“Plan ahead, make a list, set a budget and stick to it,” advised James Rogers, president of The Coastal Bank. “Don’t procrastinate (shopping) because that causes you to buy at the last minute. Everybody spends more doing that.”
“Most consumers at holiday time are torn between maintaining the status quo with their usual expenses and affording those special gifts that bring happiness to loved ones,” said Kathy Wise, business development and financial advisor with GeoVista Credit Union. “But there are several best practices that can help consumers keep holiday madness at bay.”
Wise suggests shoppers make a list with the maximum amount they will need to spend for each item. Just like Santa, making a list and checking it often helps keep consumers organized and encourages them to spend “within their limits,” she said.
“Check with friends and family members on sharing in some gift-giving to help reduce individual spending even more,” she said. “Sharing the cost helps reduce your overall budget, but can benefit the receiver as well, with an upgraded gift.”
Bankrate.com also suggests giving homemade gifts or food items, like baked goods, as a way to cut costs. Giving the gift of time, such as taking a friend or relative to dinner or a movie, can be another inexpensive gift-giving alternative, according to the website.
Wise added that maintaining a budget every month helps consumers keep expenses in check year-round and helps folks add to their regular savings account as they hunt for holiday bargains.
She suggested consumers consider opening a Christmas club savings account sometime during the year.
“On Oct. 1, the rewards of their planning are deposited into their account for use on gifts, and any remaining balance stays in their savings accounts as an added benefit for the budget-wise,” the financial advisor said.
“We always recommend someone setting up a saving account just for that purpose — Christmas shopping — and saving ahead,” Rogers said.
The bank president also recommended that consumers only use credit cards for what they are able to pay off once the first of the New Year rolls around.
“Stay disciplined and be practical,” Rogers advised.
Wise said although some might be tempted to overspend using credit, responsible credit-card users can reap rewards.
“Some credit cards offer reward points that can be accumulated for other purchases,” she said. “Consumers save up points for airfare on their next planned trip, or a specific item. Keeping receipts all in one place for Christmas returns can be challenging as well, so credit-card use pulls all those receipts together in one place, and the monthly bill is an excellent source of tracking spending and analysis.”
Wise suggested that consumers keep credit-card use at 30 percent of the available credit on their cards in order to maintain a healthy credit score.
“Keep credit cards safely hidden, but be prepared if all goes wrong,” she said. “Write the credit-card number and the phone number down and keep (them) at home before you go out shopping.” This is in case a credit-card holder needs quick access to vital information, should their card be lost or stolen, according to Wise.
“Also, never put a credit card on the counter or in view where someone might take a quick photo,” she warned. “Finally, shred those old credit card bills, so thieves can’t access (them) if they pillage your trash.”