With the holidays here, you may feel the pull to spend money on gifts to give out. The desire to buy gifts can lead to financial difficulties if you don’t have the financial means to do this.
Thinking carefully about your holiday spending before heading to the first store is critical. Most people don’t want to deal with financial difficulties for months after the holiday, so consider these points.
1: Interest can significantly increase overall costs
If you use credit cards to cover the gifts, you must factor in the interest you will pay. Unless you can cover the balance quickly, the interest will add a considerable amount, especially if you have a high-interest credit card.
2: Sacrificing a little might be a better option
Reducing your spending in other areas might be better so you have more cash to spend on gifts. This means that you would have to put less on the credit cards, which could save you money on interest. Take care of your critical bills, including rent, insurance and utilities.
Even though it’s the 2023 holiday season, around 25% of Americans still have credit card debt from the 2022 holiday season. If you’re one of those individuals who charged more this year, you may be in for a difficult 2024. Once the bills start coming in, you may realize that you need to take steps to get control of your finances again.
One option is bankruptcy, but you need to work with someone who can help you learn about the different types and determine the best situation. Getting the case filed sooner rather than later is beneficial so you can reap the benefits faster.