How to approach your holiday spending

The holiday season can be both exciting and expensive. Many shoppers run into financial trouble when the temptation to overspend on holiday gifts can be tough to resist. Holiday shopping can easily get out of hand, but shoppers who commit to spending only what they can afford can make it through the season with their finances intact

Below are a handful of ways college students can stretch their budgets and avoid going broke during their holiday breaks from Grand Valley State University.

1. Agree to spending limits. Come the holiday season, many people overspend on gifts for their immediate family members. Before shopping season begins, speak with members of your immediate family to discuss spending limits on gifts, agreeing that you won’t spend more than an agreed upon amount of dollars on gifts for any one person. Come to a consensus on a reasonable limit and urge family members not to exceed that limit no matter what.

2. Determine how much you can spend. Many people find themselves overextended financially come the holiday season because they never bother to sit down before the season begins to determine how much they can afford to spend. Set some time aside before your first holiday shopping excursion to examine your finances. Such an examination should give you a ballpark figure of how much you can spend. Keep a tally of all of your purchases with you whenever you go shopping, updating the list with each new purchase you make. Tracking spending can help you stay within your budget.

3. Go shopping with a plan. Visiting the mall or a town shopping center without any idea of what you’re looking for is a recipe for overspending. Put some thought and research into your holiday shopping so you aren’t spending time wandering around and buying on impulse. The more thought you put into your shopping, the more you can comparison shop and find the best price for each gift.

4. Start early. If your holiday shopping list is long or if you know money will be tight come the holiday season, begin your holiday shopping early. Doing so allows you to stretch your spending out over several months as opposed to several weeks. Shopping early also gives you more time to comparison shop and find the best price.

5. Resist the temptation to put it all on plastic. Credit and debit cards are more convenient than cash, especially now that you can buy everything from coffee to big-ticket items with the swipe of a card. Cash can be your friend when holiday shopping, especially if you have a history of overspending. Leave cards at home when holiday shopping, spending only the cash you have in your pocket. While this may be a less convenient way to shop than you’ve grown accustomed to, it will save you the grief of large credit card bills come January.

6. Another way to save money is to suggest giving the gift of experiences rather than tangible and potentially costly gifts. For example, take a loved one out for dinner or suggest going on vacation together to make better use of your collective funds. A well-timed extended family vacation in lieu of gift exchanges may alleviate the stress of the holiday season, much of which can be traced to holiday spending.

How to manage credit this holiday season

Holiday shopping takes up a considerable amount of time between Thanksgiving and Christmas Day. Shoppers who scour in-store and online retailers in the hunt for the perfect gift annually spend hundreds of billions of dollars during such pursuits.

Overreliance on credit cards to make holiday purchases can prove crippling once the calendar turns to January. According to an analysis of statistics from the Federal Reserve, the average household consumer debt in the United States was more than $15,700 as of June 2015. That’s roughly one-tenth the average mortgage debt, suggesting that many consumers are relying too heavily on credit cards when making their purchases.

This holiday season, Grand Valley State University students, faculty and staff who are concerned about swiping their credit cards too often can take the following steps to more effectively manage their credit.

• Know what you can afford. Swiping now and dealing with the consequences in January is a recipe for a rocky new year. In some cases, it can benefit consumers to make purchases with their credit cards as opposed to their debit cards. For instance, when making purchases online, it’s often safer to use a credit card rather than a debit card linked to your checking and savings accounts, as using the latter can make your life’s savings vulnerable to hackers. But don’t start swiping your credit cards until you know what you can afford. Examine your finances and only use your credit card if you know you can repay the balance before it incurs any interest. If you can’t pay the balance in full at the time the payment is due, use a debit card so you are only spending money you already have and not taking out what amounts to a high-interest loan on your holiday purchases.
• Resist retailer cards. When making in-store purchases, chances are the cashier will invite you to sign up for a retailer credit card, even offering an immediate discount if you do so at the registers. While this discount may seem too tempting to ignore, keep in mind that many retailer credit cards come with considerably higher interest fees on balances that are not paid off in full. So that discount at the register may end up costing you more money if you get to January and can’t pay the balance in its entirety.
• Try not to juggle cards. Many shoppers juggle multiple cards to avoid building up too big a balance on one particular card during the holiday season. But that’s an easy way to lose track of how much you have spent. Rather than juggling cards, use only the one with the lowest interest rate.
• Monitor your balances. Swiping a credit card is easy and hassle-free, and many retailers both big and small now accept various types of cards. Keep a close eye on your balances, checking them online after each shopping trip. This can help you control your spending and also can alert you to any fraudulent activity.

These are some of the strategies students and others who must use their credit cards this holiday season can employ to ensure they don’t dig themselves into a financial hole by the end of December.

Cut the costs of holiday travel

Travel is a significant and often expensive part of the holiday season for many men and women, including college students. Whether you’re hitting the open road or taking to the skies to visit loved ones, there are various ways you can cut the costs of holiday travel.

1. Book a budget-friendly rental. The holiday season is a busy time of year for rental car agencies, and holiday travelers who are late to reserve their vehicles may find themselves driving gas-guzzlers for the duration of their trip. When booking your automobile rental this holiday season, try to reserve a car early so you have access to the agency’s entire inventory and not just what’s left on the lot. If you do not specifically reserve a fuel-efficient vehicle, you might be stuck with a large SUV or another car or truck that costs a lot at the pump.

2. Bring your own food. Food is another often-overlooked expense of holiday travel. If you’re flying, try to eat before you leave for the airport or look up the airport and airline regulations to determine if you can bring your own food. Food purchased at the airport or on the airplane will be more expensive and is often more unhealthy than meals you can prepare at home. When driving, pack a cooler instead of relying on truck stop eateries, which tend to be fast food restaurants.

3. Try to bring gifts rather than ship them. When possible, try to squeeze as many of your holiday gifts into your car. Shipping costs can quickly add up, but you can save a lot of money if you make room for gifts in your trunk or in the backseat of your vehicle. Just be sure that the gifts do not compromise your visibility on the road. Even if you are flying, it might be more economical to place gifts in a bag you can check rather than paying separate shipping charges for each gift. Research the baggage fees versus the cost of shipping to make a more informed decision.

4. Split hosting duties. If you want to save money but are accustomed to traveling to visit family and friends during the holiday season, then consider hosting a gathering at your own home. Friends and family likely won’t scoff at being relieved of some of their annual hosting duties, and you can limit the cost of your travel to just one trip instead of multiple trips.

5. Share lodging or try nontraditional options. If you are used to staying in hotels when traveling for the holiday season, then you may want to share a hotel room with family members. Lodging costs tend to be very expensive during the holiday season, but splitting such costs with a friend or family member can help you stay within budget. People may also want to consider alternative lodging. Hotels might stretch your budget, but depending on where you plan to go, you might have some less traditional alternatives. Airbnb.com allows homeowners and even some apartment dwellers to rent their homes and apartments to travelers, and these listings may pale in comparison to rates offered by nearby hotels. If you prefer hotels, look for deals on sites like Priceline.com or Hotwire.com, which may offer heavy discounts on rooms.

Save money this Cyber Monday

While Black Friday, the day when many retailers drastically reduce their prices in recognition of the first official day of the holiday shopping season, remains wildly popular among holiday shoppers, in recent years this day has gotten some competition from Cyber Monday.

Cyber Monday is the Monday after Thanksgiving when many online retailers offer heavy discounts via their websites. Instead of Black Friday traditions like waiting outside stores in the wee hours of the morning, holiday shoppers who wait until Cyber Monday to start buying gifts can do so from the comfort of their homes or offices.

Many Cyber Monday discounts are already set in stone, but savvy students can employ a few additional strategies to make sure they’re saving as much money as possible.

• Be ready to buy. In the days leading up to Cyber Monday, make a list of what you want and, if possible, which retailers will have the best deals on those items if retailers advertise their Cyber Monday deals in advance. Some retailers only offer Cyber Monday deals during a relatively small window of time, so you don’t want to waste time comparing prices with other retailers and risk missing out on a great deal. Knowing what you want also increases the likelihood that you will get what you want on Cyber Monday, which may enable you to take advantage of free shipping deals that won’t be available later in the season.
• Buy smart. When shopping on Cyber Monday, it’s easy to be overwhelmed by sticker prices. But even the most heavily discounted items may be subject to substantial fees, negating the savings and costing you more money than if you were to simply buy the item in-store. Before making any purchases on Cyber Monday, determine the shipping and handling fees and any other additional costs that may offset the deal you think you’re getting. If a deal is simply too tempting to resist, see if there is an in-store pickup option to save you the cost of shipping and handling.
• Know the rules. Just because you won’t be waiting in line outside a store in the middle of the night on Black Friday does not necessarily mean you won’t have to get up early to take full advantage of Cyber Monday deals. In the course of doing your Cyber Monday homework, you may find certain items that you simply must have. When you find these deals, read the fine print so you know the rules regarding each specific deal. Some may say “while supplies last” or “limited supply.” In such instances, determine when the sale starts and be ready to go the moment the item goes on sale.
• Resist temptation. Cyber Monday deals are often hard to resist, but holiday shoppers should stay disciplined and buy only those gifts they need and not heavily discounted items they are unlikely to use. Buying items you don’t need can stretch your holiday budget and distract you from the shopping you need to do.
• Stack ’em up. Stacking is a term used to describe the use of multiple coupons or discount codes on a single purchase. Many retailers do not allow customers to stack discounts, but some do. Take advantage of those that do.