While holiday spending continues to produce anxiety for some, financial experts are encouraging workers are to beat the holiday money blues by being smart and planning ahead. Here are some smart ways to destress during the holidays by making smart financial decisions.
1) Don’t go overboard with the gifts. Many of us feel tremendous pressure to spend lavishly during the holidays. This can bust your budget and ruin your plans to stash away money for retirement. Realize that you don’t have to spend excessively to make your friends and family happy.
2) Try a heartfelt handmade gift instead of an expensive one. Expensive gifts may look great, but they can cut into valuable savings and result in less cash for your retirement account. Try taking some time to think of less complex gifts for friends and family. Sometimes a well-thought out, more simple gift can be just as satisfying as an expensive one.
3) Be realistic. Spending thousands of dollars on gifts during one day is not the best way to build your assets or get your retirement moving in the right direction. Sit down and figure out a realistic gift list with a realistic budget. Your wallet will be fatter and no one will even remember that you didn’t spend the extra hundreds of dollars for Christmas gifts.
4) Set a holiday budget and stick to it. This year, half of Americans planned to set a budget for holiday gifts, and 85 percent of those who set a budget are likely to stick to it. Be part of that 85% and stick to your budget. Spending the extra cash could hurt your finances and derail your plans to save for retirement. So start saving now, you won’t regret it!
5) Resist the urge to dine out. “It’s not surprising to see that American workers continue to blow their budget dining out,” said Kevin Morris, vice president of retirement and income solutions at the Principal Financial Group. “It’s easy to spend $30 here and $40 there on a meal and not think twice about it. But what if they put that money toward something more long-term, like retirement? Or building up their savings? Over time, those pizza deliveries and nights on the town add up and can make a huge difference in your budget.”
6) Use cash or debit cards instead of credit cards. Three in five workers plan to use cash or debit cards to purchase holiday gifts. This is a smart decision and usually ensures that you will not overspend. In fact, many shoppers who used credit cards admitted to spending up to 100% or more on gifts than they had originally planned.
7) Plan ahead. People are also planning ahead, which may help them eliminate stress. Three-fourths of holiday shoppers planned to begin their holiday shopping on Black Friday or before. Women are more likely than men to have begun their shopping early. This doesn’t mean that you are doomed to overspend if you are a man. Just plan ahead and execute your plan to reduce the holiday shopping stress levels.
8) Give back during the holiday season. Charity is a great way to land some good tax deductions and to feel less stressed! According to financial reports, 71 percent of employees plan to give to charity this year during the holidays. Baby Boomers are more likely than younger generations to donate money or goods to charitable organizations. Millennials, on the other hand, are more likely to volunteer time as a way to give back this holiday season. Additionally, when you are out working for charitable events or giving away some of that hard earned cash, you won’t be wasting it on frivolous expenses. Try giving some to charity this year and see how great it feels during the holiday season.
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Following graduation from Loyola Law School in New Orleans in 1990, Price McNamara served as a Federal Judicial Law Clerk to the Honorable John M Shaw, Chief Judge, United States District Court Western District of Louisiana.
Mr. McNamara founded J. Price McNamara ERISA Insurance Claim Attorney, and began putting his past experience to work for the injured and disabled clients he now represents against the insurance companies in personal injury and long term disability and other insurance disputes in both federal and state courts