The holiday season can turn even the savviest of savers into senseless spenders. In a recent survey by the Investors Group, one in four Canadians reported feeling helpless when it comes to controlling their spending. While some (62%) say they’re not concerned with spending too much because gift-giving feels good, 31% are worried about overspending and 18% say that those worries keep them from even enjoying the season.
'Tis The Season For Overspending
Those worries are well-founded. To find out just how much Canadians tend to overspend during the holidays, RATESDOTCA conducted a poll last holiday season. Close to one-fifth of respondents anticipated that they’d be spending more than $1,000 above and beyond the cost of the gifts they were buying. While it’s easy to get swept up in seasonal shopping, a little strategy can help keep more green in your wallet. To help consumers avoid common spending snafus, the Alberta Accountants Unification Agency assembled a list of the seven worst financial habits of shoppers at this time of year:
No plan/budget; “Fail to plan, plan to fail.” There are only a couple weeks left until the big day but it’s not too late to create a budget for the items you still have left to shop for.
Forgetting to track every dollar: If you haven’t already tracked each expenditure, take a look at your debit and credit card statements to get a sense of what you’ve already spent this holiday season — and how much wiggle room you have left.
Racking up the credit card: Try to use cash only for the remainder of your holiday shopping. It’s easy to overspend when you use a credit card for everything, and interest will quickly pile up if you’re not able to pay it off in full right away.
Going to the mall to get into the holiday spirit: Unless you really need to buy something, avoid malls. Santa displays and holiday music may make things feel festive, but you may also end up making impulse purchases.
Not setting boundaries: If you haven’t already, be sure to set limits with the friends and family you’ll be exchanging gifts with. If you can’t afford something, be honest with them. Don’t let emotions or pressure rule your spending.
Skipping homemade gifts: The best gifts don’t always come from a store. If you’re crafty, use your talents to create handmade gifts such as wreaths, ornaments, quilts, vases or jewelry. Give loved ones certificates for homemade meals.
Adopting the "I'll pay it off in January" attitude: Don’t ignore your bills until the new year. Stay on top of your expenses now to avoid shock — and interest — in January. Resolve to start the new year off with a clean financial slate.