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It’s Time to Talk About Christmas

How to Avoid Holiday Debt This Year

We know it’s not even Halloween yet, but if you make a plan now, you’re less likely to overspend and be strapped come January.

No one wants to be shocked by the amount of debt they racked up during the holiday season. Talk about a way to ruin your New Year’s resolutions! Yet Americans continue to spend more and more each year during the holidays – especially as kids today are begging Santa for iPhones, tablets, and Xbox One’s…  If you can easily pay off your holiday debt in January, this might not be a problem. For everyone else, a few handy tips can help cut down the interest payments.

Plan Early

Some stores start putting out their decorations early – and by early we mean August-early! While you do not need to start that early, getting ahead of the crowds is vital. An early shopping plan allows you to spread out the expenses over the course of a few months, interest-free. Shopping throughout the fall also allows you the first pick of the best holiday gifts this year.

Stick to a List

Impulse-buying is like kryptonite to anyone trying to shop on a budget. Every little snack or magazine you pick up in the grocery store line cuts into your budget. Around the holidays, buying on impulse can add up quite a bit faster. Before you start browsing online or head to the mall, make a list and set a spending limit for each person. Try not to exceed this limit by very much, so you do not feel compelled to spend more on other people to even it out.

Don’t Use Credit Cards

Credit card interest rates, on average, are over 16%. Store credit cards typically carry interest rates well over 22% APR! You could pay hundreds of dollar in interest if you don’t pay off the balance quickly.

Credit cards, especially store credit cards, can get you into big trouble. With all the rewards points, bonus dollars, and extra incentives they give you to use their store’s credit card, you forget that the balance is adding up. Stores love to tell you have much you saved vs. how much you spent. Don’t get fooled. If you can’t pay off the balance the next month, or even within 3 months, you’re better off using cash, or a closed-end option like a Holiday Loan.

Get a Holiday Loan

Holiday loans are perfect for those who want to budget. Why? Because it’s a set dollar amount with a low, fixed interest rate. That means you’ll know how much you can spend in total, how much your monthly payment will be, and it’s closed-end. That means you only have a certain period of time to pay it off, unlike a credit card where you could carry a balance for years. In 2020, Money FCU is offering $2,000 for 1 year with an interest rate of 2.99%. If you know you can’t pay off that credit card with an interest rate of 21% within 1 month, you’re better off with a Holiday Loan.

Avoid Price Gimmicks

Stores know that customers will get a little desperate to complete their shopping as the year wears on. If you are aware of the sneaky tactics companies use to try to get customers to buy more stuff at higher prices, you can get out of it completely. Bear in mind that there will only be a handful of real deals at each store on Black Friday, and those products will be in very limited supply. If you cannot get that TV after standing in line for hours, are you going to go home empty-handed? The store is pretty sure you will not, and works hard to ensure that you pay near full-price for basically everything you get that day.

Consider Gift Cards

If you have ever fallen victim to the sirens of Black Friday, you know what it feels like to see the same item you fought over dropping to the same “special” price you paid the week after Christmas. If one of your kids or a family member really wants the hot ticket item of the season, consider giving them a gift card or cash. Gift cards are great for:

They may have to wait a few more days for the gift, but they could get it for much less. As an added plus, you will not have to shop around everywhere to get it. Money FCU offers VISA gift cards that are great for everything!


We’re Here to Help!

Holiday shopping is fun and exciting, but can quickly become stressful and confusing. Stores know this and lure you in with every chance they get. Don’t let holiday debt put you in a financial dilemma come the start of the New Year. A little planning ahead goes a long way.

If you have questions on budgeting or want to talk about an alternative to credit cards, call, chat or stop in! We’re here to help! (315) 671-4000 or



Each individual’s financial situation is unique and readers are encouraged to contact the Credit Union when seeking financial advice on the products and services discussed. This article is for educational purposes only; the authors assume no legal responsibility for the completeness or accuracy of the contents.


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