With the cost of living soaring across the country, this holiday season is going to be especially tight for many of us. While it’s normal to feel like you want to give your family the best Christmas yet, overspending can lead to serious consequences. It might seem easy to just use your credit card to pay for holiday expenses and deal with it in the new year but spending money that you don’t have is a sure-fire way to get yourself into debt.
This year, consider challenging yourself to a credit-free Christmas, where you only pay for things with money that you already have. Ideally, you would have already set aside money for the holidays throughout the year. However, for those who haven’t yet done that, consider using some savings that you have put aside in order to avoid the credit card.
To figure out how much money you need, map out a budget. Write out everything you need to buy for the holidays (don’t forget food and decorations) and divvy the gift budget up by the number of people you need to buy for. If you have a pre-determined amount of money to spend per person, you’re less likely to overspend. Once you’ve determined the budget and what you can afford, withdraw the exact amount of cash you need from your bank account. Pay for everything with cash and do not spend any more than you’ve budgeted.
Shopping online without a credit card
Many banks offer Visa Debit cards that allow you to buy things online the same way you use a credit card. The difference is that with Visa Debit, when you make the purchase, the money gets taken directly out of your bank account, similar to when you pay in store with a debit card. If you don’t have a Visa Debit card, ask your bank if they offer one. And don’t forget to put some of your dedicated holiday budget in your spending account so that you can debit directly from it if you do any online shopping.
Another way to pay online without a credit card is through PayPal. With PayPal, you can top up your account ahead of time with the amount you have budgeted. Many vendors accept PayPal, so you shouldn’t have an issue buying things through this platform. When you go to check out, instead of paying with a credit card, you can pay with the money in your PayPal account.
Cash reduces your risk of identity theft
Credit card theft is heightened during the holidays because of the increased number of shoppers and a higher amount of money being spent. As a result, there is a higher chance that your card will be stolen and maxed out, causing you unnecessary added stress over the holiday season and into the new year. So do yourself a favour, ditch the credit card, spend only money you know you have, and have a joyous holiday season focusing on who’s around the tree – not what’s under it. Come January, once all the holiday hype is over, you’ll be thankful you won’t have to open a hefty credit card bill.