- A majority of holiday shoppers expect to feel financially burdened this year, according to a recent survey from Bankrate.
- Despite these statistics, those who do their holiday shopping early are setting themselves up for financial success.
- “You still have a few months left and you still have the opportunity to build up some savings to avoid getting into credit card debt,” said Ted Rossman, senior industry analyst at Bankrate.
David Paul Morris | Bloomberg | Getty Images
The end of the year doesn’t just bring autumn leaves and lanterns, followed by mistletoe and the possibility of snow; It can also bring financial distress.
Nearly half of consumers say their financial situation fluctuates seasonally, and one study shows that December is the month with the most financial stress, followed by November and January. delay By LendingClub Corporation and PYMNTS Intelligence.
Meanwhile, 54% of holiday shoppers expect to feel financially burdened this year, anticipating higher costs overall. end Bank interest research.
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Despite these statistics, holiday shoppers who start saving early for year-end shopping are poised for financial success, experts say.
“You still have a few months left and you still have the opportunity to build up some savings to avoid getting into credit card debt,” said Ted Rossman, senior industry analyst at Bankrate.
Nearly all Americans (92%) are cutting back on their overall spending in some way, according to a CNBC and Morning Consult poll.
By this point, many people are already paying for their holidays. Half of holiday shoppers plan to start shopping before Halloween or have already started. Bank interest rate.
Although some people complain about seeing Christmas trees in stores because the temperature is still 90 degrees in some areas, “the fact that these sales started early is an advantage,” Rossman said.
Some retailers are even starting holiday sales early. Target for released members only price cuts He added that Oct. 1 and Best Buy followed suit on Oct. 2, while Amazon and Walmart are expected to do so on Oct. 9-12.
“Starting deals early allows you to research the best options and spread your cash flow,” Rossman said.
Booking flight tickets for holidays is also cheaper in October. Domestic round-trip fares on Thanksgiving averaged $268 per ticket, down 14% from last year. Prices for Christmas are about $400 round trip, down 12% from last year, according to Hopper. data.
Shoppers looking to travel for the holidays should make flight reservations by October 14, Hopper’s chief economist Hayley Berg previously told CNBC.
Buy gifts for friends and loved ones throughout the year to spread the cost, says founder certified financial planner Carolyn McClanahan. Life Planning Partners In Jacksonville, Florida. Also, if you have a specific gift in mind, pay attention to whether there are any good end-of-year sales.
In general, think ahead about what your gift-giving budget should be so you don’t create a financial strain.
“It’s better to start early because last-minute shopping becomes very reactionary,” said McClanahan, who is also a member of CNBC’s Council of Financial Advisors. “You end up spending more and buying less thoughtful gifts than if you actually put the effort into it.”
Here are a few ways holiday shoppers can start preparing:
- Start setting money aside. Save a portion of each paycheck between now and the end of the year. McClanahan said banks’ “Christmas Clubs” are separate, short-term savings accounts where consumers accumulate savings for holiday shopping and spending. If you’re not opening a Christmas Club account, consider “parking your money” in short-term savings options that have high liquidity and benefit from high interest rates, such as money market funds.
- Be careful with credit cards. As long as you pay off each card by the end of the month, you can benefit from credit card rewards and benefits. Otherwise, you risk accumulating additional debt for discretionary expenses, especially since the average credit card interest rate is more than 20%. “We definitely want to avoid that,” Rossman added.
- Take stock of unused gift cards. Nearly half of Americans, 47%, have at least one unused gift card, and the average value is almost $200 per person. Bank interest rate to create. Rossman said shoppers should “take stock of unused gift cards” so they can get a head start on holiday shopping.