Get ahead of debt!

The unexpected money move you need to make right now

Although it may feel like January was two years ago, it's actually only been six months. Big breath in. Big breath out. (Just be careful not to breathe on anyone.)

That means we are only five months away from the financial beast that is the holiday season - yay?

Frankly, thinking about all that will happen between now and then is enough to make me want to crawl back into bed and never leave. But let's look on the bright side, limited shopping and traveling now gives us a fantastic opportunity to get our money together so we don't fall into the financial holiday debt trap most people do!

Whatever may be happening on earth, the world will still spin and the holidays will come. And they will not be cheap. The average American spends about $900 on gifts - a big jump in expenses for most people. Even if you have a smaller family or aren’t religious, the holidays are expensive! According to CNBC, the average household carries about $6,900 in credit card debt and 28% of 2018 holiday shoppers were still paying for 2017 presents, crazy! After interest, that means you're paying $1,000 for only $900 worth of items. So let's not give the credit card company your hard earned money - keep that $100 for yourself.

Your mission this month is to start your holiday presents savings fund now!

I feel like Amy Santiago and I could bond for hours over binders, tabs, and notebooks.

With a holiday savings account and an automatic transfer, you have twenty weeks to squirrel your money away, little bit by litte bit, so you can fully fund your holidays. If you put away $45 a week from now until the beginning of December, you'd have that $900 all ready to go. You wouldn't have to put anything on your credit card, you could just pay for all gifts with debit. You wouldn't have to stress. $45 is an example, any amount, consistently set aside, will help keep you from taking on or increasing debt.

How to do this?

1. Open a sub-savings account (make sure there are no fees for this) called "Holiday Presents 2020", "Spoiled nieces 2020", "December Gift Bribe Money"- or whatever cute name that represents what the money is for and has a date on it. Preferably one that will make you smile when you look at it. (I would LOVE to hear your cute bank account names, email them to me!)

2. Choose how much you will set aside either every week or every month. You can always change this, so if you aren't sure, start small and reassess after a month. The important part is setting it up! If you get stuck, start with $5 a week or $25 a month. You probably won't notice $5 a week less in your checking, but you will certainly notice when you have $100 in your savings account come December! Put an alert on your calendar in a month to change the amount depending on how it goes.

3. Set up the automatic deposits on your bank or credit union's website.

Voila! December-You thinks July-You is brilliant and wants to give you a hug.

Cheers,

Ms. Moody