Why getting into the holiday spirit now will help your bottom line later

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We just welcomed fall and retailers are already promoting the winter holidays in a big way, with Christmas trees, ornaments and other decor lining store shelves. Though many of us enjoy spending time with family and singing along to favorite jingles over the holidays, you likely aren’t ready to get into the jolly spirit just yet.

However, these early-bird promotions are a good reminder that December is around the corner and you need to start thinking about a holiday budget. After all, planning ahead is key to keeping finances in order. Given that the average American household is carrying a revolving credit card balance of $7,400, preparing now is key to avoid any additional budget strains or adding to that debt load.

With less than three months before the shopping season kicks off, follow these steps to prep and pad your budget in time for the holidays.

Pay down debt.

It goes without saying, your biggest focus now should be to pay down those credit cards as quickly as possible. Carrying revolving balance every month is a huge waste of money, and your stress level heading into the holiday season will be compounded if you still have debt. Not to mention, it will cause you to actually spend more on those gifts. Take the time to evaluate exactly how much you owe and how much progress you can conceivably make within a few months. This process will (and should!) determine how much you can afford to spend on holiday festivities. Then stick to that figure no matter what!

Create a savings plan.

Many banks still offer holiday club accounts which provide you with the opportunity to stash cash for the upcoming shopping season. For many, having a separate account keeps those funds out of sight and out of reach. Another option is to open an online savings account which offers a better interest rate and makes it harder to dip in to. Set up automatic transfers on a weekly or monthly basis depending on how much wiggle room you have in your current budget. For instance, putting away just $20 a week can help you save big over $200 by early December.

Read more: 10 things to know about the new EMV chip credit cards

Go on a spending diet.

Reign in your discretionary spending now for a healthier holiday budget by limiting the season’s tempting purchases such as fall fashion, pumpkin spice lattes and all-things Halloween. Look for lower-cost alternatives like setting up clothing and costume swaps with friends and DIY harvest and spooky outdoor decor. Additionally, look for other ways to cut back on monthly bills by reducing Internet speed, cutting premium movie channels and unplugging gadgets to lower your energy bill.

Cash in on clutter.

Whether you have bags of unwanted clothes or an old gadget laying around the house, take the opportunity to sell items you no longer use for your holiday savings. While a garage sale is a great way to unload all your clutter at one time, you can typically get more money for clothing and other valuable goods by selling through a consignment shop or online. The new eBay Valet service makes the process easy: Drop off or send your collection of goods to the company and their team will do the work of selling for you. When all items are sold, eBay sends you 80% of the profits. Other sites to sell your goods are Gazelle.com for electronics, Thredup.com for gently-used clothing and Amazon Marketplace for kids’ toys and small kitchen appliances.

Read more: Beware of fake online consumer reviews

Track flights.

The sweet spot for purchasing airfare is typically six weeks before your desired departure date. When it comes to the busy holiday season, however, you need to buy flights months in advance to secure a cheaper rate. Research airfare prices now to get an idea of the general cost then set up a price tracking alert using Yapta.com. The site will alert you when prices dip so you can buy a ticket immediately.


Boost your budget.

While you should always look for ways to earn extra income, now is a particularly good time to do so.  Apply your professional skills toward freelance opportunities at eLance or assist someone in your area with a small task like grocery shopping or handy work via TaskRabbit. If you have spare time and like animals, you can watch someone’s dog or cat for the day or night by signing up at Rover.com. Otherwise, check out mystershop.org for paid local mystery shopping gigs which you can complete when running errands like buying gifts. For someone with more flexibility, consider a part-time retail position — many companies and retail chains are already hiring seasonal staff.

Read more: How to make a disposable razor last 12 months!

Begin gift shopping.

Buying a few gifts over the course of these next few months will limit the financial strain you’d otherwise experience when purchasing multiple presents at peak shopping season. Look out for big sales on summer clothing now; small kitchen gadget and home decor deals during Columbus Day; and buy off-season to save. Before you start shopping, draft a list of recipients and keep track of the items you pick up for each person so you don’t forget what you buy then double up come December.

For more money-saving advice, see our Shopping & Retail section.

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