Avoiding holiday debt

Plan, give and spend smart to avoid holiday debt

Just as you might pack on a few extra pounds over the holidays, you might pack on some extra debt too. On average, Americans plan to spend more than $550 on gifts for friends and loved ones this holiday season, according to a recent NerdWallet survey conducted by Harris Poll. Do you have that much to spend without running up your credit cards? Here are a few tips to avoid burying yourself in debt: 1 Make a plan — and stick to it In the 2016 holiday season, nearly a quarter of Americans surveyed didn’t have a gift budget, according to the online Harris Poll of 2,135 U.S. adults. Figure out how much you can spend, and make sure to budget for extras like gift wrap, holiday cards and meals. And consider limiting your recipients list too. Do you really need to get presents for all of your co-workers, neighbors and the mailman? “Give yourself the gift of a stress-free start to the year by not waking up to a bunch of credit card bills,” says Steve Branton, a certified financial planner in San Francisco. “Once you know the amount you can actually spend without going into credit card debt and who you need to give a gift to, you can work back from there to determine who are the most important people, how much to spend on them.” 2 Give creatively Consider giving experiences, homemade gifts or hold a gathering in lieu of gifts. “It behooves people to consider what all the options are around gifts, and there are a lot of creative things you can do to show someone you care without spending a lot of money,” says Paul Golden, spokesman for the National Endowment for Financial Education. 3 Spend smarter Get the best value when shopping. Use your credit card points to buy gifts without spending money. Do comparison shopping to make sure you are getting the best deal. And watch prices even after buying; using a store’s price-match policy or your credit card's price-protection feature could mean you can get a better price later. If you are prone to overspending, leave the plastic at home. Sticking to cash puts a physical limit on your ability to spend.

This article was provided to The Associated Press by the personal finance website NerdWallet.