Monday, December 5, 2011

The Surefire Way to Manage Your Holiday Shopping Budget

The Surefire Way to Manage Your Holiday Shopping Budget

It’s once again that time of year when we go shopping for our loved ones. Just so I don’t raise your hopes, this column is not about where you can get the best deals. Instead, let’s talk about what I call the “year-end shock syndrome.” Have you noticed that most people end up spending w-a-a-a-y much more than they actually “intended” – or rather, “expected” – when it’s all said and done?
Of course, that doesn’t happen to everyone, and I am by no means claiming to have a crystal ball, but I think I do know how it happens. You see, most of us want our loved ones to know how much we really care about them by the kind or size or price of the gift we give them. So we make a list of people (sometimes with gift items intended for them), and then we shop for the best deals we can find.
But at the end of it all, nine out of 10 people end up breaking their budgets – that’s if they had a budget to begin with. To be totally honest, that used to be me many, many years ago before I came up with this slightly different (yet powerful) approach that ensured that I stick to my budget.

Here’s what you need to do:

Understand the fact that the true value of a gift is not measured by its retail price. Just the thought behind presenting the gift trumps the price you paid for it at the store. I realize that conventional theory seems to suggest the opposite, but you’re going to have to make a shift in your thinking or be prepared to face the ugly consequences of excessive spending.
Just to be clear, I’m not suggesting that you give inexpensive gifts. Not at all. Who wouldn’t want to give their loved ones the entire world, so to speak? But to do that at the expense of staying financially sound is quite frankly foolish, wouldn’t you agree?

With that in mind, when you make your list of names, you MUST place dollar amounts next to them. As simple as this sounds, without this step you are sure to spend more than you intended to. If you think about it, why shouldn’t that happen? It’s an open check book (or credit), because you’ve placed no limit on your spending. 

To state the obvious, by actually including dollar amounts, you’ll know how much you will be spending so that it doesn’t come as a surprise after the fact. This is the best way for you to make the necessary adjustments to prevent any unintended negative consequences down the road. Have fun shopping!

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