Holiday shopping can really get the best of us. With sales and deals offered on all kinds of items, consumers can easily emerge from the holiday season and into a new year seriously in debt.
Baltimore-based money managers T. Rowe Price recently released an interesting report on the 2015 Parents, Kids & Money Survey that showed 62 percent of parents living in Orlando luxury homes, Oviedo real estate properties and other locations admit that they spend more than they should or planned to over the holidays. What’s worse is that 9 percent report taking reserved monies from the family’s emergency fund to pay for these excesses. On top of that, 7 percent of respondents confessed that they dipped into their IRAs or 401(k)s to covers these holiday expenses.
Problem with Overspending During Holiday Time
The problem with all of this is figuring out a way to get back on your feet again.
This can be especially concerning if you are hoping to buy new homes for sale in Oviedo for the first time in the near future or move up from your Oviedo real estate property to Orlando luxury homes; or another upgraded home listed on the real estate rolls; or complete a remodeling project that you’ve put off for months or years.
Whatever your plans may be within the Oviedo real estate market or with the Orlando luxury homes real estate property you own, the amount it may end up costing you will depend heavily on your credit score.
Avoid Sabotaging Your Credit Score
Every year, consumers are entitled to one free report from each of the three major credit reporting agencies: Experian, Equifax, and TransUnion. Advisors at the Financial Industry Regulatory Agency recommend three ways to ensure your credit score remains in good standing and you don’t sabotage it with overspending.
Be Proactive: Do check your credit report annually. Take advantage of the free reporting offered to you as a consumer. If you see something wrong in your credit report, alert all three agencies as soon as you can. Correct credit reporting errors because they won’t fix themselves.
Credit Cards Should Not Be Maxed: Did you know you negatively impact your credit utilization rate when you push your credit limits to the max? It’s true. Your credit utilization rate measures your total amount of available credit. The balance that is owed on your credit accounts comprise 30% of your credit score. Financial experts recommend that you keep your credit utilization below 10% of your available credit.
Pay on Time: The longer a bill goes unpaid, the more damaging the effect on your credit score. If you know that you can’t pay a bill on time, let your creditors know immediately to see if you can work out a payment plan.
Tips to Control Holiday Shopping
Now that you know why you need to keep your holiday shopping in check, here are three ways for you to maintain self-control during the next few weeks.
- Shop Early: So you don’t frantically buy things because you are running out of time, experts suggest you shop early to avoid overspending.
- Give Thoughtful Presents: It really isn’t the price tag that means the most to most people. Put thought behind the gift and take time to put your own mark on it, such as making a scrapbook for someone or creating a book of certificates that allow a person to “cash in” on time with you during the year.
- Budget Together: You and your spouse should discuss just how much is ok to spend so you can keep each other accountable. If you aren’t married, talk about your goals with a good friend to keep yourself accountable.
