Holidays are just around the corner …

I know, it’s not even Halloween yet! I get as annoyed as the next guy when I see Christmas showing up in the stores before Labor Day; however, I felt this was a timely message as many of you are about to begin the annual holiday shopping expedition!
This time of year spending can easily get out of hand. We want to create a happy time for our families, and, we can be challenged by retail stores who are masters at temptation, hawking holiday trinkets with special sales, two-for-one deals, etc. By taking some time to think things through before you head out to the mall you can plan for a more effective shopping trip, and expect fewer regrets come January.
While we are sensing early rebound in the economy, it is still prudent to be mindful of our spending. With that, a few tips to help you out this holiday season …
Start with a spending plan, include limits and stick to it! Decide how much you can afford to spend, review your list of who you want to buy for, divide accordingly. You may want to spend more on children or young struggling adults; if so, make the adjustments and then divide the balance of your budget. Remember, once you are out in the mall, you are prey to the retailer’s temptations. It’s easy to succumb to impulse buying with all the deals around you. I know I find this a good time to purchase a fresh pair of winter slippers for myself; if you have a similar habit, include it in your spending plan. Keep in mind, Caveat Emptor – Let the Buyer Beware!
Ditch the credit cards! Head down to the bank and withdraw cash to equal your allotted spending amount. Keep in mind that all purchases will add sales tax, and you may need funds to buy lunch or a little snack – I know I do, shopping wears me out! While it is convenient to use a credit card, know that credit card companies are aware of this and may provide incentives if you use their card during this time of year. All too quickly, it’s easy to stray from your plan and now you’ll be paying interest charges on all the extras.
The shop early advantage. This allows you to take advantage of all those tempting sales by having time to seek out the best bargains. It also helps to avoid last minute panic shopping when you just need to buy something, anything, to cross a name off the list – not only are you unable to be thoughtful with your purchase, you are more inclined to overpay out of desperation.
Be creative. If time is on your side, consider homemade gifts (think candy or calendars) or personalized gift certificates (think babysitting or cooking a meal-a-month). Kids come up with some pretty interesting ideas for loved ones when shopping at a dollar store. Consider a White Elephant exchange among family members. Check out the Internet for an endless list of creative gift giving.
The after holiday sales will happen. Kind of like death and taxes, you can be certain of this. This is time to take advantage of significant savings. If there is something that doesn’t absolutely have to be under the tree on Christmas morning, then wait. It’s also a great time to shop for cards, wrapping paper, etc. for next year’s holiday season.
Beyond gifts. While gift giving is, for most, a significant expense, be mindful that the holidays bring additional expenses. There’s the Christmas tree, decorations, wrapping paper, cards, postage, party food and drinks, perhaps travel, extra activities – maybe a new dress for the company party, shoes and purse to match, jewelry and a babysitter to watch the kids when you go … easy to see how this can get out of hand.
Already on a shoestring budget? If so, the most important advice I can give is to talk about it, don’t shove it under the rug. If things are tight, maybe this year it should be about getting creative and really focusing on the reason for the season. Perhaps gift giving can be a lower priority, or based on the creative ideas mentioned above. Kids can be amazingly resilient with things like this. This is a time to consider a holiday fund for next year; you’ll know some money is tucked away, some of the stress reduced.
Have fun! With planning, communication and proper perspective, whether money is ample or tight, you can enjoy a meaningful holiday and maintain financial stability. Finally, let us remember the reason for the season: reflecting on goodwill toward men and peace on earth brings a spirit of joy that lingers all year.
Kristi Ellington is a registered representative with and securities and advisory services offered through LPL financial, a registered investment advisor. Member FINRA/SIPC.