Newswise — Don't let holiday spending overwhelm you in these tight financial times. As bargain hunters get ready for "Black Friday," the day after Thanksgiving in the U.S. and traditional start of the holiday shopping season, experts have some tips to avoid busting your budget. Prepare a holiday budget using realistic expenditures and stick to it, advises Dr. Debra Pankow, assistant professor and family economics specialist at North Dakota State University (NDSU), Fargo.
Some advisers suggest spending no more than 1.5 percent of your annual income on holiday items. For families with an annual take-home income of $50,000, that means limiting holiday spending to $750. Pankow says the first step in preparing a holiday budget is to set spending limits. Start with a family meeting to discuss the amount available for holiday spending, set priorities and plan a budget.
Dr. Sean Brotherson, associate professor and family science specialist for the NDSU Extension Service, suggests that adults need to establish realistic holiday spending guidelines first. Then adults can hold a family meeting and ask children or other family members to help prioritize purchases or gifts. Brotherson emphasizes that such family meetings might encourage planned family time, personalized or inexpensive gifts and family activities to enjoy during the holiday season.
Families need to consider what they want to spend on each person, according to Pankow and Brotherson. Make sure to include holiday giving. If the amount adds up to more than you can afford, lower it.
Tips to keep holiday spending on budget-Consider making gifts or giving a gift of service, such as gardening or painting or volunteering at a charity. Family members also could draw names instead of giving everyone a gift.
-Make a list of what you plan to buy and take that list with you and review frequently when shopping.
-Pay for gifts with cash instead of a credit card. This helps reduce spending because people think more carefully when paying with cash.
-If you do buy on credit, keep a list of the expenditures as though you are writing checks to help you stay within your budget. Review it often.
-Open a Christmas or Holiday Club savings account and deposit money throughout the year to make sure cash will be available in time for next year's holiday shopping.
Beware of patterns that can lead to overspending-Responding to sales pressure or buying something because someone suggested the purchase was a good idea
-Trying to impress others or seeking other people's approval
-Making a purchase because it's something the family always has done
-Being swayed by advertisements
-Making impulse buys instead of comparison shopping
-Thinking that spending money will help you feel better when you are depressed, angry or sad
-Being unable to say no, especially when children are asking you to buy something for them
-Shopping aimlessly without a clear purpose or idea of what you wish to buy and how much you have committed to spend
For more information:NDSU Extension Service's family economics http://www.ag.ndsu.edu/money/.
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