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3 Powerful Strategies for Avoiding Holiday Debt This Year by Tony Mase
Although there's not much you can do about last year's
holiday debt, other than pay it off as quickly as possible,
there are three *powerful* strategies you can use to avoid
holiday debt this year.
Here they are:
Powerful Strategy #1 - Start your holiday shopping NOW!
And pay *cash* for what you buy. :-)
Now, I'm not real big on "shopping" (I far prefer to make a
list, go to Amazon.com, order what's on it, and be done with
it), however I have a friend who is.
She essentially begins her holiday shopping for the
following year the day after Christmas of the current year,
taking advantage of the often massive markdowns retailers
offer, often 50% - 75% or more, to begin her holiday
shopping early.
Then, throughout the ensuing months, she continues her
holiday shopping, picking up gifts here and there, taking
full advantage of sales and markdowns as she runs into them,
and paying *cash* for what she buys as she goes along.
Come late October or early November, just when most folks
begin thinking about starting their holiday shopping, she's
done with hers and, this is the important part, doesn't owe
anyone a dime for the experience.
Wise strategy! :-)
Powerful Strategy #2 - Take advantage of "Layaway".
Layaway, also known as lay-by in some countries, is a
service some stores offer that allows you to purchase an
item without having to pay the entire cost of it all at
once.
Essentially, when you put an item on layaway or lay-by, you
make a down payment on it and the store physically holds the
item for you until you either pay it off in full, according
to some predetermined payment schedule, at which time you
physically receive the item, or a certain period of time has
elapsed, in which case, if you haven't paid for the item in
full, it's returned to stock and you receive a refund of any
payments you made on it.
Although there's sometimes a small fee for this service,
it's usually *far* less than the interest you'd pay if you'd
charged the same item on a credit card and paid it off "over
time".
Wanting to promote their own credit cards, and thus make
more money, some stores stopped offering layaway or lay-by
in recent years. However, due to the apparent current state
of the world economy, many of them have begun offering it
again, some heavily promoting it as an alternative to
credit.
As it makes far more financial sense than buying on credit,
layaway or lay-by is well worth taking advantage of when you
want to purchase an item, but don't have the money to pay
for it in full right now.
Powerful Strategy #3 - Start your own "Christmas Club".
A concept born of the "Great Depression" and popular for
many years thereafter, "Christmas Clubs" were special
savings accounts, offered by banks, into which customers
deposited a set amount of money each week and then received
the money back at the end of the year for Christmas
shopping.
Although there may still be some, I don't personally know of
any banks that offer this service anymore.
However...
It's easy enough to start your own "Christmas Club" or
"Holiday Club".
Here's how:
1. Open a special "free" no minimum balance required savings
account at a bank or simply stick an empty envelope in a
drawer.
2. Determine how much money you want to have available for
holiday shopping this year.
3. Divide that amount by the number of weeks remaining
between now and when you want to start your holiday
shopping.
4. Deposit that amount of money in your special "Christmas
Club" or "Holiday Club" savings account or envelope each
week (or twice that amount bi-weekly if that's how you're
paid).
5. On the date you'd decided to start your holiday shopping,
withdraw the money from your account or envelope and go
shopping.
It's that simple. :-)
Well...
There you have them...
Three powerful strategies you can use to avoid holiday debt.
Use them individually or in combination with one another and
you'll insure yourself a debt-free and, I might add, stress-
free holiday season this year.
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