By Anna Marascio, Peer Ambassador
While the holidays are an exciting time to gather and celebrate with family and friends, they often spark financial stress amongst those who struggle to manage their finances. According to LendingTree, in 2021, 36% of Americans took on holiday debt, a 31% increase from 2020. Of those 36%, only 18% of those will be able to pay off their debt within a month. From feeding the whole family on Thanksgiving, to buying holiday gifts or throwing a killer New Years Eve party, money can get tight. We might even ask ourselves, “Where do I draw the line between generosity and overspending?” It makes sense why nearly 90% of people feel some sort of anxiety about the holidays. However, spending money should not take a toll on our mental health.
A common stressor over the holidays is that we swipe our credit card a few too many times or spend more than anticipated. In order to counteract this, we can create a clear budget and allocate money to specific categories of expenditures. Based on the average annual income and average Christmas expenditures in the US, Americans spend approximately 1.6% of their annual income on holiday gifts. Therefore, calculating this for ourselves could help keep holiday spending under control.
With this being said, let’s talk about a few financial tips we can all take advantage of this holiday season:
- Pay with cash instead of a card while shopping. This will serve as a visual to track your spending.
- Take advantage of sales and discounts while online shopping. You can even do a quick Google search for coupon codes. Sales will save you a ton.
- Take time to dig out those old gift cards. They are worth every penny!
- Finally…DIY gifts or homemade desserts are a financially sound way to share some holiday spirit while staying within your budget.
Make sure you’re being intentional with your finances during the holidays, because the only thing worse than a lump of coal in your stocking is an empty wallet!