News You Can Use: Surviving Black Friday – How to set a budget and stick to it

Black Friday (so named because of its effect on retailers, not its effect on consumers) has come and gone.  But many of us still have a significant amount of Christmas shopping in our plans.  We found the following article by Hadley Malcolm  on the USA Today financial page (link to full article is below) and hope you will find it helpful if your list isn’t completed yet.

Carols trickling from retailers’ speakers signal the start of the holiday shopping season, and consumers are gearing up to give their wallets a workout.

The last months of the year can put an anxiety-inducing burden on personal finances. Consumers, on average, have charged about $5,400 to credit cards during the fourth quarter in the past four years, according to data from credit agency TransUnion. And U.S. shoppers are expected to spend about $805 each during the holidays this year, according to the National Retail Federation.

At least some shoppers are feeling good enough to spend more than last year. Deloitte’s holiday survey of more than 4,000 people found that 19% plan to spend more this year, the highest share who said so since the recession.

Staying on track when you’re bombarded with enticing deals for two months straight can be difficult, which is why savvy holiday shoppers need a game plan, financial advisers say. Here’s how to break down your spending, plus a rundown of the days with the best deals.

  • Decide how much to spend. A good rule of thumb is to allocate no more than 1.5% of your income — $750 if you make $50,000 a year, for example — for holiday expenses, says Carla Dearing, CEO of SUM 180, a financial planning service aimed at women. And don’t forget big-ticket items: That number includes expenses such as flights, not just gifts, she says.
  • Write it down. Whether you’re a spreadsheet junkie or a compulsive list-maker, put your plan in writing. That includes at least a rough outline of who you to plan to spend on and how much you plan to spend, says John Rosenfeld, head of everyday banking at Citizens Bank. Keep your plan with you — such as on your phone or a notecard — so it’s easy to reference while you shop.
  • Significant others. Keep your budget within reason by agreeing to a spending limit ahead of time, says Ken Chaplin, senior vice president at TransUnion, and Sean McQuay, credit card expert from NerdWallet. You may also consider going in on a joint gift, or experience, you’ll both enjoy, rather than purchasing separate items.
  • Credit vs. debit. To manage your money and hold yourself accountable, you may want to open a checking account solely for your holiday spending, Rosenfeld says, adding that he often hears from customers that they want the option to “segregate their funds into different pools. It keeps them from spending too much in one direction that wasn’t intended.”

http://www.usatoday.com/story/money/personalfinance/2015/11/23/how-to-budget-for-holiday-shopping/75713656/, accessed on 11/26/2015.