Last week we saw someone with five credit cards with over $60,000 in Credit Card debt. The minimum monthly payments were $1,200. By only paying the minimum monthly repayments, it would take them 8 years and 5 months to pay off the card whilst paying $63,277 in interest.
We see it time and time again. People spending outside their means especially around the FESTIVE SEASON. There is a great deal of pressure to spend up big on gifts at this time of year, but pricey presents aren’t necessarily the way to go.
Here are some ways that you can show you care, while keeping a lid on your spending and avoid hocking up any more DEBT:
- Agree on a spending limit – Suggest to your loved ones that you set a limit on how much you will spend on gifts for each other to keep your budgets under control
- Kids only – Talk to the other adults in your extended family about only buying presents for the kids this year, rather than for the adults
- DIY vouchers – We often remember the things people do for us rather than the presents they give us. Consider giving redeemable vouchers for tasks like babysitting, massages, picnics, homemade dinners or even housework.
- Savvy sales – Take advantage of sales throughout the year to nab some bargains and store them away for Christmas (e.g. Black Friday sales / cyber Monday. The perfect time to get ready for Christmas).
- Second-hand bargains – Op shops, antique stores and second-hand bookshops can be a treasure trove for the thrifty Christmas shopper. If you’re prepared to spend the time looking through their stock, you can often find good quality items at a fraction of the price you’d pay at big-name stores.
STAY PREPARED… If you are going to shop in-store, consider these rules-of-thumb to reduce Christmas shopping stress and limit the temptation to overspend:
- Set a time limit on your shopping – Get in, get it done and get out so you aren’t tempted to spend more than you want to.
- Buy less expensive stuff first – If you buy larger and more costly items first you can lose perspective on what is a good price, so set your budget, buy small first, and then tackle the big stuff so you stick to your gift budget.
- Limit your shopping locations – Only go to shops that you need to visit so you don’t get distracted and impulse buy.
At last but certainly not least, ensure all of the above is done WITHOUT getting into any more credit card DEBT. No credit cards. Pay cold hard CASH. Australia currently has $45 billion dollars of credit card debt.
That said, if you have any debt that you cannot manage CONTACT US TODAY… We can help!