Tips on how to spend smart this festive season
Did you promise yourself that you will not overspend during the festive season? And yet, at the end of the last year, were you left to deal with quite a bit of unintended consequences on your credit cards? If you plan not to fall into the same trap again, you have to formulate a game plan and play by the rules.
Let us look at how you can turn this festive season into a financial success.
Know where you stand
What does your credit report say? This would give you an idea of your financial health. Maintaining a healthy score is useful if you are going to apply for a card or a loan, especially for this festive season.
Clear existing balances
How much outstanding do you have on your cards? Do you have time to pay the dues before the season? If you are unable to clear your balances, you can consider doing a balance transfer on your card. This feature helps you reduce the high interest you pay on the balances and pay back in easy EMIs.
You can also consider taking a personal loan to consolidate your debts and bring them under manageable payments.
Know what you can and can’t afford
Don’t worry if you have not saved for the season yet. You don’t have to feel pressurised to buy expensive gifts for family and friends. Make a list of all possible expenses and get creative to see how you can cut them down.
Now you know your financial health, and also have a clear idea as to how much you can spend for the festive season. However, the most important key to having a successful season is to set a budget and stick to it.
Shop and then Stop
While you can allow yourself a bit of leniency, as some items might have higher value than estimated, ensure you check the list of things you had planned to buy and then stop. This applies to all other ‘spur of the moment’ expenses like outings, dinner parties and decorations. Use cash instead of credit as it will help you stick to your budget.
Know how you are going to pay back
Choose what you are going to use to pay for the holiday expenses - debit or credit card based on the benefits. Have a plan as to how you are going to pay back the credit card bills.
The festive season is a joyful time to be enjoyed with family and friends. At the same time, we hope that these tips will help you be a wise spender this festive season.