Credit cards feel good

Forego the holiday credit card binge.

It is just easier to swipe your credit card. According to the National Retail Federation, the average spending per person this holiday season will be about $806 dollars, and almost half of the browsing and shopping will be done online – it is just easier to use a credit card. However, according to the Consumer Financial Protection Bureau (CFPB), Consumers tend to spend more using credit cards than they would with cash. In addition, consumers tend to make choices today that their future selves wouldn’t make.

With a little planning today, you might be able to save some money, and still make it feel easy. Stop and think. Buying for the holidays is a money decision. Set goals for your holiday shopping:

  • Who am I shopping for?
  • What do I want to purchase for them?
  • Where can I purchase the item(s)?
  • How many people am I shopping for?
  • How much can I afford to spend on each gift?
  • Do I have a spending plan for my monthly needs?
  • When do I want to complete my shopping?

For more planning ideas, see my article published by Michigan State University Extension from last year, Be wise this holiday season. One idea that may work for some is to use your holiday spending dollars to purchase gift cards for yourself. Wait a minute! What did I just say? Yes. After your planning is complete, buy gift cards from some of the retailers that you have pinpointed for completing your shopping list. Then use the cards on-line or at the store to make your purchases. You will not have to carry around a lot of cash and it may be as easy as swiping that credit card. However, the flaw in the plan is if the recipient needs to return the gift, so do not use this idea unless you have specific items in mind and you are confident that the item will not need to be returned for cash. Prepaid debit cards are an option as well, but make sure that you understand the risks and fees associated with them. The CFPB has good information on this subject.

Managing money is not easy. It does take patient and discipline. However, little steps can make a difference. If you would like to learn more or would like to find a Money Management class in your area contact a Michigan State University Extension expert

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