Editor’s note: “A Better Life” is a new weekly column by the USU Extension – Tooele Office that will focus on a variety of topics intended to enhance quality of life.
It’s Christmastime. The bells are ringing…or is that the ring of the cash register? Did you know that the average American will put $1,000 on a credit card for Christmas? Research has shown that those who charge on credit are apt to spend up to twice as much.
Giving is one of the best parts of Christmas, but think about setting reasonable limits to what you spend on family and friends. Talk it over with them. Watch your “little spending” — buying this and that for stocking stuffers, the neighbors, the paperboy, etc. Ask yourself: Do I need to spend this much money or would a small homemade gift be nice? Put a budget on spending and do your best to stick with it.
Here are a few things to think about while holiday shopping:
Ever been at the checkout stand and the helpful clerk asks: “Would you like to save 10 percent today and open a store charge account?” It’s tempting. But consider the amount saved vs. the extremely high interest rates (around 21-25 percent) most store credit cards carry. If you have their store credit card, you are apt to spend much more than if you paid cash. It also isn’t healthy for your credit report to open a bunch of store credit cards. So think about it before you automatically say yes.
If you plan to buy any appliances or computers, the sales person will often ask you “Would you like to take advantage of our extended warranty?” Just in case the item breaks down, the warranty will cover it. Beware: warranties are largely profitable for the retailer but for you they are often a bad deal. Think about it before you automatically say yes. You can do a little research and add the warranty later if you want.
You want to get a gift for a friend, but you just don’t know what she’d like. But you do know her favorite store and a gift card would be perfect. But be careful. Make sure the gift card doesn’t have an expiration date or associated fees. Merchants make a lot of money off of gift cards and certificates that are never redeemed. Consider a homemade gift certificate that includes you taking her shopping.
Here’s something kind of radical to think about: Do you remember what you got from friends and loved ones last Christmas? Try to make a list of everything you received. You may remember a thing or two, but most people can’t remember them all. That begs the question: how important were all those material possessions? My favorite Christmas memories are of times shared during the holidays, playing board games with my mom and dad, or cutting down a tiny little tree on our family ranch and hauling it home to decorate it.
I’m not saying that giving gifts isn’t important; of course it is and it’s fun, too! By keeping track of how much you are spending, you will have a better grasp on things. I know one family that chose to give only $5 presents to each other. Choosing just the right gift for under $5 was a fun challenge. They were able to take the money not spent on gifts for 3 years and went on a family vacation together. The memories will last a lifetime.
Have a great holiday season! Enjoy the memories made with each other this Christmas. I’ll be offering several financial classes, including a Family Finance Challenge, in January. Look for more information soon. If you would like more information, please contact me at the USU Extension Service in Tooele County at 435-843-2350.
Darlene Christensen is an associate professor at the USU Extension – Tooele County office, which is located inside the Tooele County Health Department Building, 151 N. Main, Tooele.