According to a GoBankingRates survey over 50% of Americans
spend at least one paycheck during the holidays. While 22% spend two paychecks,
6% three paychecks, 4% four paychecks, 3% five paychecks and 9% six paychecks. Forty-four
percent expect to spend two paychecks on more during the holidays.
These
alarming statistics indicate that Americans need to spend less and save more.
It also indicates that Americans are not prepared for a financial crisis such
as illness, divorce, unemployment, death of a loved one or a natural disaster.
These statistics show a lack of control, discipline, impulse
buying and an eagerness to keep up with everyone else. If Americans saved money
throughout the year they would avoid the holiday shame when their credit card
bill arrives in January.
Advertisers knows that consumers are triggered by emotion so
retailers create advertisements to heavily tap into consumers emotions to
encourage them to spend more money. Holiday shopping should equal the amount of
money you can comfortably afford to spend – money that will not be needed in
the near future for another purpose.
The best way to curb overspending during the holidays is by calculating
how many hours it takes you to work to earn enough money to purchase a specific
item. For example, if you feel the urge to buy a large flat screen television
that costs $1,000 and you earn $998 each bi-weekly paycheck, it will take you 80
work hours to earn enough money to purchase the television. Here are 5
fantastic ways to avoid spending your paycheck during the holidays.
Create financial goals
Set financial goals that you want to achieve for the next
five years. Every time you think about spending money determine how the purchase
will affect your financial goals.
AVOID PEER PRESSURE
Ignore peer pressure your family, friends, colleagues, other
parents or neighbors to purchase at item even it is for a good cause. If you
can’t afford to purchase the item and purchase it anyway you are the only one
who suffers.
REEXAMINE SPENDING HABITS
If you overspent during the holidays last year or earlier in
the year, examine why you overspent and solve the root cause to prevent overspending
in the future.
GIFT GIVING
Reevaluate how you purchase gifts. If you have a large
family consider a secret Santa exchange so you are only required to purchase
one gift for one person. If your family has a large number of children skip
buying gifts for the adults and buy gifts for the children. Another option is
to purchase gifts for your immediate family and work with your family to set a general
spending limit.
SPEND LESS
Spend less money on those persons you purchase lavish gifts
for in the past. If they complain tell them you are on a budget this year and
need to stick to your budget. The amount of money spent on someone should not indicate
your feelings for the person, i.e. if you spend less money it does not mean you
care about them any less.
