6 Tips to Prevent Overspending This Holiday Season

This marks day one of our series Put a Bow on Your Holiday Budget: 6 Days of Advice.

It’s a season for giving, but it’s also a season for spending.

This year’s edition of the commercial madness that is Black Friday brought 226 million shoppers to retailers nationwide, a 6-percent increase from 2010, according to the National Retail Federation.

It’s becoming increasingly easy for consumers to get carried away in the financial frenzy of the holiday season. Military members and spouses aren’t immune to the pressure to overspend on gifts for family and friends.

Here’s a look at six tips that can help you avoid a holiday spending hangover that could wreak havoc on your credit score or your bottom line:


On a tight budget, don’t bother buying gifts for every member of your extended family or all of your coworkers. Make lists of who gets what—gifts or a card—and stick to them.


With lists in hand, forecast a budget. Break it down by item, week or month. Don’t break your budget.

Store credit cards

Yes, 25 percent off your purchase sounds great, but not when you have to sign up for the store’s credit card. Every time you sign up, the store checks your credit. Hard credit inquiries like this are fine in small doses, but several of them in a short duration do not look good on your credit report.

Your credit cards

To help stick to your budget, keep an eye on your credit card balances. If you use several cards, add up all of your balances because that’s what you’ll owe in total. Remember, a balance on any one card should stay below 30 percent of its limit.

Pay with cash

Avoid plastic altogether by buying gifts with cash only. This can help you stick to your budget when you put the cash in an envelope. That envelope is your budget.

Dining out

With friend and family visits and frequent travel, going out to eat is bound to happen on nights nobody feels like cooking for a dozen people. When you go out with a big party, picking up the tab can be a great gesture, but exercise caution and moderation.

Staying within your means during the holidays won’t be a breeze, but apply some of the above tips to save yourself from having a financial crisis in January.

Thanks to MoneyBlogNewz for the photo under a Creative Commons License on Flickr.