‘Tis the season for debt

Every year holiday spending per consumer goes up and much of that spending ends up as credit card debt. Shedding that holiday debt is harder than shedding extra holiday pounds.

At the holiday season it is hard for even debt-wary and credit-savvy consumers to avoid over-spending. It’s not easy to resist buying that special gift for that special person.

The best way to finance your holidays has always been the Christmas savings account. Saving for your holiday spending throughout the year and not relying on credit cards with high interest rates could end up saving you hundreds of dollars over the course of repayment.

The interest on these accounts is minimal, so don’t plan on making money. The discipline in saving ahead of time is a good exercise in financial management and the peace of mind you will have when you pay for your holiday expenses without running up credit card debt is priceless.

Next year, plan on saving for Christmas a little bit at a time. Contact a banking institution about their holiday spending account plans.

We may hate that word discipline when it’s applied to ourselves, but it is the single most important factor in deciding whether we are rich or poor. Without self discipline, we will spend lavishly on the whims of the moment and end up with a mountain of trash and no money.

So how to become disciplined where money is concerned? Gary Simpson of Personal Finance Budgeting suggests taking out a large denomination bill from your bank account, say $100, putting it in your wallet and then never spending it! To know that it’s there gives one a good feeling – and having the determination never to use it for purchases builds self discipline.

It’s a good system and I can see that it would work. That is, if you actually have $100 in your account, of course…

Everyone starts somewhere, I guess. Have a read of the article – it’s full of good sense.