Millennial Money: Save for Holidays Now and Skip Regret Later

Taking holiday costs into your budget all year round is an effective way to avoid debt, but it is not always feasible with a limited budget or unexpected costs.

In that case, a lack of holiday spending strategies can make you vulnerable to debt and overspending and delay your financial goals. But it’s never too late to come up with a last-minute plan to save money for the holidays.

A small window at the end of the year can provide time for money moves to help prevent a holiday debt hangover.

1. Align your holiday budget with your financial goals

When deciding how much to spend on vacation, start with your budget, suggests Jason Speciner, a certified financial planner for the company Financial Planning Fort Collins.

“Start with how much money you’re willing to spend on giving a gift, and how much you can spend, then work on your list,” he says. “I put the cart in front of the horse and put dozens of people on the gift list so I don’t overuse it,” he says.

If your debt or budget leaves no room for holiday expenses, plan to spend time with people, give gifts, or save on secret gift exchanges through free holiday activities. Set expectations early by alerting people to your plans.

Adding to a pile of debt during the holidays is costly and takes time to repay. Strategize how to repay debt and prioritize high-interest debt first. A balanced transfer credit card with good credit (FICO score 690 or higher) allows you to transfer debt from a high interest rate credit card to a low interest rate credit card (probably a 0% intro APR). There is usually a 3% to 5% fee for each transfer amount. In the absence of interest, monthly payments are applied directly to your balance, reducing the time it takes to repay your debt. With less than ideal credit, a debt management plan by an accredited non-profit credit counseling agency may provide relief if you are struggling to make progress.

2. Use bonus friendly season

If you are borrow-free and plan to get a new credit card, look for one with a sign-up bonus that can provide additional cash or rewards to cover the cost of the holidays Please give me. Sign-up bonuses usually offer a three-month period to meet your spending requirements and are easier to reach if you are billing for daily and holiday expenses. A card with 0% APR at the time of purchase can also save interest money for some time.

3. Earn rewards with the cashback app

Cashback apps can add value with daily purchases. You may need to upload a receipt, but it’s worth the effort for Krystal Sharp, the coupon coach and creator of the blog Krys the Maximizer. She uses Ibotta, Fetch Rewards, and other apps to earn cashback and gift cards. With these apps, you can add in-store or online offers from specific retailers and earn cash back on eligible items you purchase. Alternatively, you can upload a receipt to take advantage of certain benefits. You can also get incentives by introducing others. For more value, Sharp makes purchases using rewarded credit cards and accumulates revenue.

“We focus on how to get gift cards, get referrals, save enough in the store and use the store benefits to buy what you need for your vacation,” she says.

According to Sharp, daily purchases can make $ 20 to $ 25 in a week or two, depending on how much you spend, which is usually sufficient. Revenue will be added over time.

4. Save with “Challenge without Spending”

The surest way to save money is to avoid making unnecessary purchases over a period of time. You can try free months, free weeks, or free weekends, depending on your preference. The money saved can offset potential costs during the holidays.

For Courtney Clarke, a New York-based content creator on TheLifeOfCo YouTube channel, “no spending in November” helped keep the 2020 debt target on track. For a month, she avoided eating out and activities and spent only on her necessities. It costs money.

“I can’t say I was perfect on this issue, but it’s a great reset to retrain my brain,” says Clark. “It just makes sure you’re trying to get the most out of it.”

She admits she spent eating out when she didn’t have enough time to prepare her meal, but even after occasional hesitation, she saved over $ 300 a month.

5. Get the side hustle

Do a side job now or clean up your house and make money for the holidays. When it comes to gig work, there are plenty of flexible side jobs to do in your spare time, from carpooling to delivery. Or, if you want to save time, sell these dust collector items in your closet to a consignment store.

“I sold a lot to Prato’s closet and Once Upon a Child to get rid of it,” says Sharp. She estimates, on average, about $ 50 per trip, or $ 200 to $ 300 per year.

Melissa Lambarena is a writer for Nerd Wallet. Email: Twitter: lissalambarena.

Millennial Money: Save for Holidays Now and Skip Regret Later

Source link Millennial Money: Save for Holidays Now and Skip Regret Later

Related Articles

Back to top button