Should you consider buying a home with debt? In this post, we discuss what potential buyers should know before making this decision!
You, like many people, might be looking for ways to save money these days. Inflation is still high and the cost of living is constantly increasing. For those of us with mortgages, our monthly payments may be rising too. Of course, saving money is hard when the holiday season rolls around, and avoiding holiday debt sometimes feels impossible. How are we supposed to buy gifts, ornaments, and decorations without blowing our budgets? While holiday debt is common, it’s also preventable. Here are some tips to help limit your chances of experiencing holiday debt this year!
Set firm price limits
It’s very easy to go over budget when shopping during the holiday season. This is especially true if you hit the mall with only a vague idea of what you want to buy and how much you’re willing to spend. Even adults can often act like kids in a candy store when they go shopping with no firm price limit in mind. To combat these temptations, set very specific budgets for your shopping this year. Have a chat with whoever you’re exchanging gifts with about a price limit, so you don’t have to worry you’re spending too little and go overboard on the presents. There might also be the potential to do a secret Santa type of gift exchange if you’re part of a friend group or larger family.
You also need to budget for your decor and holiday treats. Decorating the house is a lot of fun, but it can be expensive if you keep adding onto your collection without a second thought. Think about specific spots you want to decorate, what items would truly work well there, and stick to that, instead of buying dozens of little items that you’ll try to find room for later. Price limits and budgets don’t have to put a damper on your holiday spirit as long as you shop wisely!
No new credit cards!
Around the holiday season, it seems like every other store you enter has overhead speakers announcing their new credit card or rewards program. These might seem like a great way to save this season, but more often than not, it’s not an amazing deal for you. If you sign up for a credit card with every store you enter, many of which you likely don’t shop at often, this will leave you with required minimum payments and interest rates that will add onto your monthly expenses. The more opportunities you have to spend, the more likely you are to spend. Say no to these types of offers, and stick with whatever your current credit card situation is. Don’t fall into the trap of trying to juggle five different cards for no reason!
Avoid (unnecessary) sales
The word “sale” has a tendency to draw people over. Sometimes sales are fantastic, like when an item you’ve been needing for months is suddenly half off. Around the holidays, though, you’re bound to see tons of “buy one, get one half off” and similar offers for items you wouldn’t have bought in the first place. Maybe it’s a good deal, but if you weren’t even looking for the product that’s on sale, you’re still spending unnecessary money by buying it. Remember that sales still require you to spend money, so only indulge in sales on items you would have bought anyway. It might be helpful to leave the house with a specific list of items you need. This way, it’s easier to have a firm idea of what you need to buy, and what you can leave behind.
Pay off your credit card regularly
Late credit card payments come with interest that adds up the longer you don’t make those payments. Of course, the higher your balance, the more money that interest will amount to. During the holidays, forgetting to make a credit card payment can happen, but odds are you’ve been charging a lot of purchases to your card and your balance is quite high. A late or missed payment will mean lots of interest for you to repay. To avoid this, make a habit of paying off your credit cards regularly. This ensures you stay on top of your payments. You can set up reminders on your phone or through your banking app so you never let it slip your mind again. Making regular payments will keep your interest low and your credit score high.
Price matching doesn’t just have to be for groceries. When you’re shopping for gifts and decorations, odds are there will be several stores that have similar items. You don’t always have to buy the first, or the most expensive, item you see. Take some time to shop around at different stores to see if you can find something similar to what you’re looking for at a lower price. For example, you might find Walmart has products nearly identical to the ones you can find at upscale home decor stores, likely for a fraction of the price. Though it might take a bit of time and patience, this is a process worth doing if you’re looking for the best deals. You can also browse online to compare prices more quickly and easily!
Holiday debt can be an easy trap to fall into, but you can help yourself avoid it with a few tips and tricks, and likely some self-restraint on spending. This is a fun season for buying pretty new items and gifts, but keep in mind it’s not the most important part of the holidays. Plus, you will feel a lot happier on the other side of this season if you come out of it without being in debt. Financial planning and budgeting are more important than ever right now!
If you have any questions about your mortgage, get in touch with us at Clinton Wilkins Mortgage Team! You can call us at (902) 482-2770 or contact us here.