Tis The Season To Saving

The holiday season is the most financially dangerous time of the year. There are all the parties that must be attended, the gifts that must be given, and the restaurant meals that must be eaten due to the countless hours of shopping. Because of the beauty of it all, we don’t realize the damage done to our finances until the new year has arrived. Then, we make a New Year’s resolution to do better next year and begin the whole process all over again.

Don’t get me wrong; I love the idea of celebrating the reason for the season. But somewhere along the way, we’ve lost our way. The Thanksgiving to Christmas season is the largest and most profitable time of year for retailers. According to a Lincoln Financial Group study, the typical American is expect to spend $1,115 this year on Christmas gift, with men spending $1,428 on average—charging it all on credit cards with an annual percentage rate (APR) of 19% on average.

Average American Holiday Debt $1115
Average Credit Card (APR) 18.9%
Total Interest Paid Based on Min Payments $1171.68
Total Amount Paid Based on Min Payments $2286.68


Based on the above information, Americans will be paying twice the amount for their holiday spending habits. And if we continue to do this year after year, we will be digging a debt hole that we will never get out of. This just does not sound like the reason for the season to me.

Now, I am not saying we should not have a giving sprit during this specials time of the year. But it should not be about the size of and/or the cost of our gifts. Gift giving, especially during this time of year, is supposed to be about thinking about someone else other than yourself. But I personally do not want or need a monthly reminder (a bill) over the next couple of years that will enforce me how much I cared about someone.

So, this year let’s agree to try something different:

  • Let’s agree to spend only what we can take from our paycheck to pay for the holidays.
  • Let’s agree to not have any holiday spending bills that are due after 31 December 2017.
  • Let’s agree to not let the number of and/or the size of the gifts we give be an indicator of how great the holiday season is going to be.
  • Let’s agree to keep holiday spending to 1% to 1.5% of our gross incomes.
    • With the median American yearly income being $55,000, this means that the median American budget for Christmas gifts should be between $550 to $825.

So, lets take the time to enjoy the holiday season while being in keeping with our new-found views on money. Spending pressures from family, friends and Corporate America will make it difficult to show financial restraint during this time of year. But keep up the good fight and start your 2018 on a better financial footing.

The Broke Architect


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