With Christmas next week, many individuals are finishing some last-minute Christmas shopping before celebrating with family and friends. According to data from the National Retail Federation (NRF), Americans, on average, spend between $902 to $1,014 on Christmas, which is roughly a week’s salary for some individuals. Iowa Department of Insurance and Financial Services Financial Literacy Director Heather Kriener says that the holiday season is when consumers are more likely to spend more money without giving it much thought until after the fact. Kriener says to save yourself from headaches later, budget ahead of time.
Kriener says a common misconception is that many purchases are made on a credit card, with the individual believing they could pay the balances off later and not spend the whole amount right now. Kriener says that is not the best way to go.
A rule to follow used to be for individuals to spend one percent of their yearly salary on gifts. Kriener says it’s not a one-size-fits-all and should be adjusted depending on holiday plans.
With it being last minute, Kriener suggests going for more creative gifts, like homemade gifts or pictures, to save money. Individuals looking for extra help managing finances year-round, not just during this holiday season, can check out programs that Kriener helped initiate. Links to Save4Later and SmartHer Money are included below.
