The upcoming holiday season may promote excessive spending.
The best way to cope with a materialistic time of year is not to
fall prey to pressure from the retail world. At the end of the day,
as long as there is Christmas, there will be gift-giving. How
much money should you plan to set aside for this season? Many
financial planners recommend spending no more than 1.5% of
your annual income on holiday spending. For example, if your
annual household income is $50,000 you should spend $750 or
less on holiday gifts, travel, and entertainment. After you set
a budget, aim to pay cash for your purchases, buy local, find
sales, and avoid applying for department store credit cards that
can put you further into debt. Remember what’s most important.
The holidays are a time for making memories and spending
time with family. Give yourself a break and remember the
true meaning of the holidays!
Colleen Craig, CPA CA, CIRP,cecraig.com