When You Go Christmas Shopping, Leave the Cards at Home

That's the advice of financial experts all over the country. They've told us year after year that the Christmas shopping season is a huge temptation to overspend, and that we can stick to our budgets better when we pay in cash. But did we listen? No. And now we're feeling the squeeze of all that accumulated debt. 

We did it with the best of intentions. Maybe we knew that we couldn't afford those purchases, but we didn't want our kids to go without. Or maybe we spent too much on food and entertaining expenses so that our families could enjoy their time together. Whatever the reason, we consumers took our eyes off of the real treasures of the holiday season and bought too many budget-busting gifts and items – many of which we’re still paying off. 

The latest Consumer Action poll found that 69% of Americans will be paying in cash during the 2008 shopping season. It sounds like Christmases past have left us with a nationwide case of buyer’s remorse, and now we’re trying to repair the damage without putting ourselves deeper into debt. 

If you, like many Americans, are still paying off your purchases from last Christmas, here are some sound tips for keeping you out of the red this holiday season. 

Make a List and a Budget 

When you go shopping, you need a plan. Look over your finances and decide who you should buy for, and how much you can afford to spend on them. Then take a deep breath and exert some self-control. Stores are designed to make you spend money. Stick to your plan, and you’ll be fine. 

Leave the Cards at Home 

If you’re trying not to use your credit cards this year, having them in your wallet might be too much of a temptation when you see discounted items that aren’t on your list. Studies show that consumers spend almost 20% more when shopping on credit. Remember your dwindling cash reserves and stick to your shopping list. 

Use Layaway 

Some major stores like K-mart have reinstated their layaway programs. If you can’t afford a lump sum purchase, put the items in layaway. Unlike credit card purchases, layaway buys won’t be compounded with hefty interest. They also have a definite due date by which they must be paid in full, unlike credit cards which can keep you paying for years with minimum payment amounts. 

Learn to Say No 

Tell your kids, friends, and relatives when you simply can’t afford to make a purchase or host an event. Millions of Americans are weathering financial hardship this year. The topic is no longer considered taboo, and people are more understanding than ever. 

And what will you say when a store associate offers you a tempting deal on a new department store credit card? “No, thank you.” Have confidence in yourself, stand firm, and enjoy your cash-only shopping season.