Making Your List and Check It Twice!

Christmas and Holiday time bring about good cheer this time of year! With all of the office parties and home party opportunities, it is hard not to get caught up in the moment of well wishing and fun. It can also be challenging at the stores or online not to get caught up in the credit card using. But Christmas time can be the right time to check your spending list twice and see if your budget will end up on the naughty list.
Here are a few tips for you and yours this Holiday Season to keep your budget in line and your generosity in check:

1. Have a Holidays savings account. These originally called “Christmas” accounts were simply a separate savings account whereby money was deposited throughout the year by the account owner (often automatically from a paycheck); so by the end of the year the money to be spent for gifts was already there and what was not there was not spent. This is still an idea as bright as a Christmas Tree LED. You may still establish these accounts with your bank or favorite savings institution (watch for any fees that would take away from this being fruitful). Of course, setting this account up is more helpful if done a year in advance. If you are the last minute type, let’s look at some other choices for this year.

2. Create A Simple Budget- By taking a few minutes to sit down with your laptop, iphone, ipad or the old-fashioned legal pad with pen (still one of my faves) and making of list of who to buy for and how much to limit for each gift, you can easily and quickly provide yourself and your budget a smart solution for this buying season. More importantly, after the Holidays are over, you will have no buyer’s remorse or budget regret!

3. Pay with Cash- I am a big believer in knowing not only the cost of something but the cost of that something to your future. If you are like me, you enjoy buying something on sale. It certainly feels good to believe that we purchased a good or service at a deep discount to what it normally would sell for. However, that good feeling can be easily overcome when the credit card or bank statement arrives in the mail or even faster to us online. So you and I might have bargained a good purchasing price but our statement will confirm to us that the bargain or bargain(s) still added up to be more than free. This statement shock hurts later than at the time of purchase. To avoid this painful feeling later try buying your gifts with cash. It hurts a little more to pay cash for something at the time of purchase for a couple of reasons. One reason is we know immediately how much that gift truly cost our wallets and purses. Secondly, we see how fast whatever amount of cash we are carrying on our person goes away creating an immediate sobering feeling. The combination of these two factors makes our brain and our heart have a quick conversation with each other to keep everything in check, mainly our budgets.

4. Finally, our last tip is check your list twice! When you make your shopping list for gifts and it is keeping within your budget, you are home free right? Well not exactly. Often times we get so carried away when we start shopping that we end up buying more than what we had on our original list. I know I have been in stores and the friendly sales clerk tempts me with the, “buy one item get the second item half off or 70% off!” They may even throw in a free snow globe if your purchase minimum with their store is $100. You may be like me in finding it hard not to justify continuing to add to your list. After all, isn’t it cheaper to get the per item cost down? The answer is no. It sounds great, no doubt about it. Who doesn’t want to get 50-70% off the second and third items? What may be helpful to remember in purchasing those second and third items: They aren’t free. So stick with your list, just like Santa! You will be thanking yourself for doing so when the credit card bill comes flying in from the North Pole to a mailbox near you in January!

Happy Holidays,
Morris Nutt

Morris Nutt is an Investment Management Consultant with Raymond James Financial Services, Inc.

Member FINRA/SIPC located at 8820 Trinity Road, Ste. 201 Cordova, TN 38018.

Morris can be contacted at 901-757-4448 or at [email protected]

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