A swipe of your credit card may seem an easy way to take care of extra costs, but if you can’t pay off your balance in the interest-free period, then it’s dumb debt.
It’s just not smart to get into high interest debt you can’t afford to pay back, because the longer you leave it, the bigger and more expensive it will get. Meaning you’re spending more than you need to!
Christmas present buying is one area where costs can get out of control. Giving gifts is a chance to show your friends and family just how much they’re appreciated.
But it’s easy to feel under pressure to spend a lot at Christmas, and scrambling to do last minute shopping can lead to impulse purchases and a maxed out credit card.
Here are a few tips, to help you spoil your loved ones with thoughtful gifts this Christmas, and at the same time avoid waking up with a debt hangover in 2012.
A cliché yes, but at Christmas it really is the thought that counts. No one wants to be cheap, but the more thought you put into a gift – the more likely it will be appreciated and the less likely people are to think about its cost. Take some time to think about what your friends and family will adore, that you can realistically afford. You might want to give yourself a spending limit for each person.
Get savvy with online shopping – it’s the perfect way to quickly compare different gift options, and prices. Just remember to factor in any delivery costs and check the website’s returns policy.
Look for presents in unique places. Markets can be a great place to pick up gorgeous one-off gifts, like cute cushions or jewellery, which often come with lower price tags than you might find in stores. Depending on the tastes of your friends and family, you could also check out vintage shops, they can be a great place to pick up beautiful, but inexpensive, scarves and bags.
Unwrapping presents at Christmas is half the fun and a beautifully presented gift can make it seem more special, and look more expensive. So make the most of stores offering free gift-wrapping – where they do it well!
Get creative. You might want to get in touch with your inner domestic goddess and make fudge or homemade jam, and package it beautifully. Or offer any time or talents you have – offering your time as a baby-sitter may be more appreciated than an expensive gift by someone in need of quality time with their partner.
Christmas gifts don’t have to break your budget to be special, so take some time to think about how you can show your friends and family how much you care without sending you into debt.
Check out www.sorted.org.nz/xmas where you can find useful tips on how to avoid a dumb debt trap this Christmas, and in the spirit of Christmas – share your tips with others.