Financial literacy is an all-year round commitment and the holidays can knock the most budget oriented person off track. The holidays are a minefield of overspending and overindulgence. Here are the three spending traps that most of us fall into:
The pre-holiday festive build up (of hidden costs)
When the rich colors of fall turn into the long, dark cold of winter, the holidays are something fun to get excited about when the sun sets at 4pm. Going to work and coming home in total darkness is probably the reason we love twinkly bright Christmas lights and get carried away with decorations. The eggnog lattes, festive decor, extra liquor, extra gifts and food that we consume only during the holidays, adds up very fast. It’s bad enough that we gain extra weight – throwing debt on top of that just adds insult to injury.
Christmas napkins seem to be my vice (just me?). Every year I buy some, don’t use them, and then find the others I’ve neglected from previous years, when I’m putting them away, promising myself I’ll remember them next year. Then the Groundhog-Day cycle repeats itself.
The ‘buy yourself something as an emotional band-aid’ trap
Who amongst us can deny ever succumbing to this? *Looks out* Good, I don’t see any hands raised. This trap deserves an individual section because of how our unique triggers can cause such a powerful emotional response. It can literally send us into the nearest store to anesthetize ourselves with the swipe of a credit card. Family, especially around the holidays, can do that to the most patient of people. Buying yourself a treat is completely fine, just don’t get carried away and break the bank. We’ve all been these people. Be like Santa – have a list and check it twice!
The ‘sales, oh the sales!’ trap
Some of the best sales of the year happen right before the holidays, it’s torturous timing. You’re already swiping your credit card on decorations and peppermint flavored vodka, now that jacket you’ve had your eye on is on sale and ‘nearly free!’ Getting carried away is easy, which is why making a list and knowing what you need (actually, need) before the season kicks into high gear, is key to sticking to a budget. Snagging a sweater on clearance feels amazing but never wearing it is a waste of money.
By Kirsten Campbell