9 bad financial habits you should avoid during the holiday

During the festive season, people spend money as they've never spent before.

How much is it? Last year, a single person spent nearly $1,000 on gifts alone.

This number excludes party decorations, food, and holiday dress. Over half of holiday shopping will be done using credit cards, leaving 44% of seasonal debt holders "stressed out" about their purchasing selections later.

Cutting back is a no-brainer given the holiday debt hangover. Let's identify financial habits that are fatal during the festive season.

1. Not planning ahead

Make a reasonable budget before you start shopping. Calculate how much you can spend on others while keeping your regular monthly spending, and forget about the holidays.

2. Waiting to shop things until last moment

Avoid buying while you're in a hurry or under duress, as this might lead to overspending. With a list and a head start, you may compare shops online or download an app that allows you to evaluate prices before purchasing anything in a store.

Ensure your item is within your budget before heading to the cashier or online checkout.

3. Shopping impulsively

Fancy holiday displays or a fantastic offer on something you've been eyeing might quickly derail you. To keep inside your budget, stay firm and stick to your list.

Applying for store credit cards you don't need only to earn a one-time discount isn't an excellent way to compensate for overspending. This will exacerbate the problem. Some people even consider multiple payday loans to manage their holiday shopping and end up with a payday loan settlement to get out of painful debt.

4. Using credit cards excessively

When used correctly, credit cards can be helpful to instruments.

However, because the money does not come out of your purse or bank account as you spend it, it is tempting to overspend during the holidays.

If you must use credit, limit yourself to one card preferably the one with the lowest interest rate, and leave the others at home.

Choose a date when you will be able to pay off your holiday credit card obligations and make a commitment to do so. Check your statements for any unauthorized charges and report them right away.

5. Enjoying self-indulgence

You'll go over budget and into debt if you buy a gift for yourself every time you buy one for a loved one. Give yourself 24 hours to think about any unexpected purchases or add them to your wish list to assist family and friends with holiday shopping. Consider deferring other festive temptations, such as spa treatments, until after the New Year to manage your cash flow better.

6. Not comparing prices of items

Don't assume that the sale price is the best deal available. A little time spent researching pricing and looking for coupons might result in significant savings.

Conduct a quick search to compare pricing among big retailers such as Target, Walmart, and Amazon, purchasing online or in-store.

Free shopping apps for iOS and Android smartphones, such as ShopSavvy and ScanLife, enable fast price comparisons on your mobile device. Use these tools to determine if a retailer will match a competitor's pricing and save yourself the trouble of driving to many stores.

7. Applying for numerous store cards

On top of already appealing promotions, retail staff will promote shop cards that offer an additional discount of 10 to 20% off your purchase. Though special offers may entice you, make sure you thoroughly analyze the terms.

These credit cards have high-interest rates, low credit limits, and hefty fees.

Plus, to reap the savings benefits, you're more inclined to spend more in a single transaction. Stay with a single credit card that offers cash back to maximize benefits.

8. Spending beyond your means

If you're having trouble saving money or keeping your credit card balances low, make sure you're not living over your means. If you spend more than you earn, you're going to accumulate some potentially dangerous debt. Instead of using a credit card, switch to a debit card or cash. Reduce frivolous purchases such as dining out, streaming services, and so on.

9. Purchasing more to save money

If you find yourself paying more to receive a more significant discount whether you're enticed by buying two, get one free deal, or spending $100 to get $20 off you're probably buying things you don't need.

If you don't need something, it's a waste of money, no matter how little you pay for it. Don't allow significant discounts to sway your purchase decision.

Even if you don't save as much, it's eventually better to spend less.

If you want to save money by buying in bulk, consider splitting the cost with a friend or family member.

Lastly, the holiday season is a joyous and uplifting time of year that encourages us to give to individuals we care about. But, some of our bad financial habits make the season of joy and generosity morph into a new year of debt. We all like the feeling of pride we get when our loved ones open their gifts, but the most acceptable gift you can offer yourself is to spend within your means.

Creating a realistic budget and keeping a shopping list can allow you to spread joy responsibly while also alleviating some of the stress.