How to Have a Debt-Free Holiday

The holidays are here, and that means it’s time to start thinking about debt. Yes, we know. Not the first thing you usually think of when it comes to the holiday season. However, if you think of holiday debt now, you can easily avoid it. Here’s how.

Plan Things Out. The most helpful thing you can do to avoid holiday debt is to create a holiday shopping list. It’s that simple. List what you want to buy for loved ones and then — and here’s the hard part — only buy what’s on that list.

Create an Account. Make a specific savings account only for holiday spending. This way you are keeping things separate, which makes it easier to see exactly what you have available for holiday spending.

Use Rewards. Check your credit card reward program before you start shopping. There’s a good chance you might be able to earn points that can offset holiday spending.

Shop Online. Most of the time the best holiday deals can be found online. So before you head out to a physical store, check retailers’ sites and see what kind of deals and discounts are available.

Be Smart. One trick retailers use to get you to buy more is to create a scarcity illusion. This is when they attach phrases like “Last Chance Price” or “Clearance Deal” to get you to buy something simply because you think it’s a good deal. Once again, when presented with these deals, consult (and stick to) your list.

Do One Thing: Make a holiday shopping list and only purchase items that are included on that list.