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You know you do it. You spend too much on the holidays. You always start out saying you're not going to, and then you wake up on December 25th, or even worse on January 10th when the credit card bills hit, and feel awful. Barbara Steinmetz of Steinmetz Financial Planning lays out the 13 biggest reasons why we do this to ourselves, and gives advice on how to avoid it!
Guilty gaffes Not surprisingly, guilt seems to be the biggest source of overspending. Homemade gift guilt: Take the year ‘Aunt Ginny’ decided to make everyone a special basket, packed with treats she'd made herself: "Oranges with cloves, homemade flavored coffee, home-baked cookies -- even homemade dog biscuits." Then, because maybe that wasn't enough, she goes out and buys everyone a "real" present.
Equalizing to excess: You get each of your kids (or parents or siblings) an equal distribution of presents. Except . . . maybe you should get Mom a couple of extra little things, since Dad's cashmere sweater obviously cost a bundle. But now Mom has three presents and Dad only has one, so the least you can do is get him a book . . . repeat until broke.
Surprise-gift guilt: Your boss, friend, co-worker or neighbor gives you an unanticipated gift. D'oh! You should have anticipated this! You dash out to the store and add yet another item to your overwhelmed holiday budget.
Reciprocal retaliation: This game is deadly and has a way of snowballing before you realize it. Three years ago, you and your mate gave a couple of your friends a dinky coupon for a free night of baby-sitting. They gave you pricey Broadway tickets. The second year, you ramped up and took them out for a swell dinner. They gave you a case of wine. This year, you just want to win, so you're planning to give them an all-expense paid trip to Guadalajara -- just so they'll back down, and next year maybe you can get back to giving baby-sitting coupons. Won't happen.
Rejection rebound: In order to save money, you gave someone a gift that you got from someone else, forgetting it was the recipient who gave it to you last year. To make up for this offense, you overcompensate, now and possibly for years to come. Clearly the issue here is that we think money speaks louder than our intentions. It doesn't. Really. So before you hit the store, delete the guilt files from your operating system.
Putting off holiday shopping may cost you
Last-minute largesse: It's the night before Christmas, Hanukkah or Kwanzaa and you are out cruising the stores that are open until midnight trying to get all your shopping done in one furious frenzy. But because you realize that this blows the whole "thought that counts" thing, the thoughtless gifts you buy are also wretchedly expensive.
FedEx folly: You bought your niece in Nebraska a great new CD but waited so late to mail it that you're spending more on shipping than the gift cost. Really. As Steinmetz points out, "Those who celebrate Hanukkah at least have some excuse -- those holidays move around. But, hello, Christmas is always on the 25th. So what's the problem?"
Holiday spirit overdrive It sounds like a '70s lounge band, and maybe it should have been. In reality, it's a financial crime of passion. An insane impulse overcomes you --- holiday joy? The spirit of Santa? Your medication is off? --- and you find yourself committing one (or all) of the following:
Debt of 1,000 gifts: Getting everyone, I mean everyone, a little gift: all of your co-workers, the woman who cleans your house, the neighbor who jump-started your car in 1986, your baby-sitter, your dentist, etc. -- to the tune of $4,876.
Parental panic: You lay out all the gifts you got for the kids, and suddenly it's just not enough. You love those kids so much. You can't let them limp into January so deprived. What were you thinking? Back to the mall!
Manic Martha-ism: For once, you're going to celebrate the holidays in style. You're going to throw that holiday party, take the kids to the "Nutcracker," the Ice Capades and the "Clifford the Big Red Dog Live!" show. You're going to cater a big holiday dinner and fly your parents in, and pay Martha Stewart to inject some holiday cheer into your décor. Plead guilty, because there are too many witnesses. This year, when you sense an attack of holiday spirit coming on, send a card.
Eggnog wishes, caviar dreams These are amazingly silly, but common, miscalculations in terms of volume, time or value.
Shopping by the truckload: You go to Costco or the mall and buy everything in sight, simply because there's so much to buy.
The 12 days of shopping: You haven't found the perfect gift for her yet. You know you will. Meanwhile, you'll just pick up a pair of these earrings. And a little scarf. . . . And by the time you reach the end of your "Quest for Perfection", you have 27 gifts, none of them quite right, except maybe the pear tree with the partridge in it.
Art fair amnesia: December is upon you, so you dash out and do all your shopping -- completely forgetting that you already bought half the presents at that crafts fair in July.
These costly little slip-ups can happen in a variety of ways. How to prevent them is unclear. If only we could get them on video. At least you'd get a laugh out of yourself.
The 'unreturnable' impulse This one deserves its own category, because of all spending blunders, it is the most preventable. Every year countless people fall into a stupor as they enter one of those vile shops full of ceramics, glass and twisted bronze ballet sculptures -- and accidentally buy one for someone they love, who will inevitably hate it. Two words on this one: Just don't.
10:31 AM - Nov. 29, 2006 - {0} -
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