Grow Financial Federal Credit Union
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November 9, 2021

Holiday Shopping Tips: Avoid These Five Common Financial Pitfalls

It’s hard to believe it, but the time is here: let’s talk about holiday spending. We’ve got five holiday shopping tips to keep the season of cheer from becoming a big pain in the wallet.

As you’re thinking about holiday plans, shopping, charitable giving and more, we want to make sure you can avoid the common blunders that can set you back financially. Watch out for these five holiday shopping pitfalls:

1. Not setting a budget

You’ve almost certainly heard us talk about budgeting before and might already be familiar with the basics of budgeting. But have you remembered to plan ahead for your holiday spending? According to a National Retail Federation survey, holiday spending averaged $997 per person in 2020, with $650 being spent on gifts alone.1 So if you’re going into the holidays prepared to freestyle your spending, realize that you may end up spending more than you’d think. We recommend setting a holiday spending budget that fits into your financial plan.

Get started with two steps:

  • Set a spending limit. This is the time to be realistic. Take a look at your overall budget and decide what you’re comfortable spending on the holiday season.
  • Make an expenses list. Based on the figure above, break out your anticipated spending accordingly, prioritizing the essentials first. Don’t forget to consider travel expenses if you plan to be away from home.

2. Busting your budget

It’s easy to be swept up into spending more during a time when we want to be generous and show love to others. Don’t let your heart run away with your head.

If you need to spend less on gifts this year, that’s okay! Remember, gifts don’t have to be expensive to be meaningful. Thoughtful things like acts of service, homemade treats or heartfelt notes can be even better gifts than store-bought items. You could also look to create memories with experiences, like a family board game night, neighborhood scavenger hunt or video game tournament. When it comes to sharing joy, the best memories come from the heart, not the wallet.

3. Taking on high-interest debt

Overspending our budgets, paying high interest and taking on too much debt often go hand-in-hand. Though credit card companies or retailers may be offering deals to lure us into overspending, remember that the money must be paid off eventually. With most holiday spending, it’s just not worth it to go into debt. Stuck paying high interest already? Consider consolidating to a lower month payment with zero balance transfer fees with a Grow Visa® Preferred Credit Card.2 Learn more.

4. Falling for scams

You might be feeling holiday cheer. You know who’s also feeling cheerful this time of year? Scammers — because they have so many hooks out over the holidays. From online shopping scams to fake charitable organization scams, scammers are ready and waiting with all kinds of tricks up their sleeves, hoping to lure you into divulging personal information or sending them money. It’s important to be vigilant to avoid fraud at all times but especially around the holidays, when fraudsters look to exploit your goodwill. Learn more about three ways to avoid common holiday scams.

5. Waiting until the last minute

Many of us who typically enjoy the rush of last-minute shopping might find limited selections on the shelves. With supply chain delays causing hiccups in the availability of many items, this is not the year to procrastinate. Consider beginning your shopping season earlier than usual. Don’t forget to account for potential delays in shipping times, too.

One last piece of advice from us? Shop local. Not only do many of your local retailers, restaurants and boutiques have great gift options, but by shopping local, you’ll be helping support your community too.

1NRF Annual 2020 Holiday Survey, conducted by Prosper Insights & Analytics. Accessed October 19, 2021. https://nrf.com/media-center/press-releases/consumers-prioritize-spending-family-friends-ahead-holiday-season
2Subject to credit approval. Introductory Rate as low as 1.99% to 4.99% APR. The introductory rate is effective for the first six billing cycles for purchases and balance transfers. After the introductory period expires, or if you do not qualify for an introductory rate, your standard APR will range between 6.99% to 17.49% for purchases and balance transfers. This is a variable rate. The rate you receive will be based on your credit worthiness. This rate will vary with the market based on Prime Rate as published in the Wall Street Journal “Money Rates” table on the last day of each calendar month. The APR will not exceed 18.00%. If the minimum monthly payment is 60 days late twice in a twelve-month period, the rate will revert to a default rate of 18.00% for six (6) billing cycles. Other APRs: Cash Advances 18.00%, Overdraft to Share Account 18.00%. A finance charge of 1.00% will be charged on foreign transactions. Rates are effective as of 04/07/2020 and could change without notice. Annual Percentage Rate (APR).

 


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