Halloween begins a season not only of fun, joy, and merriment, but also a season of the pocket book. And we need to start planning right now for this holiday season before some financial "ghouls 'n goblins" haunt us straight into the new year.
Rather than resorting to wearing cloves of garlic while holiday shopping to avoid financial woes (granted, this might make sales clerks think twice about ringing you up!), I asked Gerri Detweiler if she had some suggestions. Gerri is the author of Ultimate Credit Handbook and is a respected consumer advocate.
I think there are two things you can do for yourself. The first is to have a list, but not just for gifts. You also need a list for extra expenses such as postage, cards, wrapping, travel, services, groceries, etc.
The second thing is choose your payment method wisely. Use your lists to choose if the purchase will come from savings, checking, a credit card, etc. If it is a credit card, plan in advance which one. Plan the use of the card to maximize benefit and minimize cost. For example, rewards cards or travel cards may apply sometimes and not others. The interest rate on smaller purchases to be paid off immediately are of less concern than the larger purchases paid over time.
Of no great surprise, Gerri was not only loaded with wonderful ideas, but has also offered our readers a handy Holiday Spending Worksheet.
Gerri also reminded me of an issue that had slipped my mind. Not only can unwise credit card use haunt us into the new year, but an even more ghoulish issue lingers- Convenience Checks.
The holiday season is heavily ladened with convenience checks mailed to credit card holders. They quite often carry a stiff fee and even stiffer interest rates. Moreover, Gerri reminded me that you do not have the same protection with a convenience check as you do with a credit card. A card will allow you to return bad merchandise. A convenience check will not.
You're basically on your own. The merchant has your money and you have to fight.
There are other things to consider. Rarely is ID required with a convenience check. Anyone can take a convenience check out of your trash and use them. Convenience checks are a wide open invitation to access your account and you usually won't know a thing until your bill comes. Someone once suggested that convenience checks are a convenience only for crooks and credit card companies.
Here are a few other shopping tips you might want to implement:
- Shop early, as "last minute" shopping invariably costs more. Pick your shopping dates right now and circle them on your calendar.
- Make short shopping trips. This allows you to focus on each trip so you aren't tired from shopping and therefore more likely to buy something you later regret. Shorter trips also allows you to more calmly match purchases against planned expenditures.
- Use a "two-day plan". If you see something you might want, put it on hold for two days and consider whether the gift is really a good one and if you can really afford it.
- Shop alone. You can usually think better and are more likely to quit when you get tired. Shopping alone can also help you avoid impulse buying, which is often more tempting when with someone else.
I hope these tips will help your holiday season to be one filled with true cheer and no financial regrets. Happy Halloween!
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