Consumer debt. If you don’t carry even just a little bit of it, you are certainly not the norm. Recent stats show the average debt-to-income ratio for Canadians is currently sitting at $1.69, meaning that for every dollar we earn, a lot of us own $1.69.
Although managing debt can be tricky at any time of the year, certain periods, like the upcoming holiday season, can be a little more challenging than most. Not only are there gifts to buy, but usually there are parties to attend, extra groceries and other surprises that can pop up. To help you survive, here are five easy ways to keep debt at bay and still enjoy the holidays.
1.Start saving now
Just like many things in life, the boy scout motto ‘be prepared’ is applicable when it comes to getting financially ready for the holiday season. Although it may seem a tad early to be thinking about the holidays (it’s not even Halloween yet!), beginning to set aside a little extra money now will help ensure that you have enough to afford the nice little holiday extras without adding more to your current consumer debt load.
2. Create a budget
Ahh the holiday season. Joy! Mirth! Laughter! Shiny little twinkly lights! There’s something about this time of year that brings out the kid in all of us. While this may be a good thing, it can also mean we forget about our budgets and spend more than we intend to. To prevent this from happening, it’s a good idea to create a budget for the holidays that includes those holiday extras, such as gifts or outfits for holiday parties. Sticking to this budget you’ve created will prevent overspending and help you avoid any holiday-related debt.
3. Set a spending limit
Just like creating a budget, setting other financial boundaries, like a spending limit on gifts, will help to make it easier to avoid adding more to your debt during the holidays. Setting a spending limit can actually be a lot of fun. The lower you set that limit, the more creative (and hilarious) the gifts tend to get. Be sure to tell those you are close to about your plans; it’s likely that they are in a similar situation and may be relieved to hear about the spending limits!
4. Go handmade
Holiday gifts don’t have to be fancy or extravagant. In fact, the simple handmade gifts and kind gestures are often the most touching, sincere and appreciated. These homemade infused syrups, for example, are a nice festive gift that you can give to co-workers, friends or hostess gifts that won’t cost you an arm and a leg.
5. Keep it simple
Finally, just remember to keep it simple this holiday season. This time of year isn’t about how many gifts you buy for others or how many decorations you put up, it’s about reflecting on the year behind, focusing on the year ahead, and celebrating with family and friends.
Whether it’s holiday spending or finding the right mortgage solution, keeping it simple is often best. Figuring out the right way to invest your money and create a solid financial plan can also be simple when you work with an investment specialist. If you’re looking to find the right investments for you, let me help! Connect with me today at (705) 315-0516.