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6 ways to help curb holiday spending

Use our tips to keep saving and celebrating in balance.

In 2011, the average consumer spent just over $700 on holiday purchases[1] — once-a-year splurges that sometimes can take months to pay off. This year, give yourself a gift: more money to put toward important financial goals like retirement. Let these tips help you avoid overspending and keep long-term savings on track.

Make a list.

Gail Cunningham, a spokesperson for the National Foundation for Credit Counseling recommends writing down everyone on your holiday shopping list and then doubling back to review the names to decide who's essential. "Many people's hearts are larger than their pocketbooks, so you need to be realistic about who you're giving gifts to," Cunningham says.

Have a plan.

Write down the items you'd like to buy for every person on your abbreviated list and their estimated cost. This will help you set a budget and keep you from wandering the aisles — which could tempt you to spend more, Cunningham says. Compare your holiday list to your regular budgeted expenses such as rent or a mortgage payment, food, and retirement savings, and make sure you can comfortably handle both.

Take breaks.

Don't let shopping sprees become marathons. Cunningham recommends taking frequent time-outs to total up what you've spent and make sure your budget's still in check. If it's not, figure out ways to cut costs.

Use cash.

Studies show that consumers typically spend 20 percent less when they pay with cash instead of plastic. If you must use credit, carry only one card — the one with the lowest interest rate.

Get creative.

Skip the shopping entirely, and opt for homemade gifts, send digital greeting cards to save on postage or plan a potluck instead of a traditional dinner. In 2011, the average cost of a festive holiday meal for 10 was $49.20.[2] It could be even less if your guests supply the sides.

Take a long-term approach.

Cunningham says planning is key to avoiding holiday debt. Setting aside money throughout the year can help you keep up with your regular retirement savings routine. "If it's too late for you this season, tally your expenses on holiday spending, divide it by 12, and start saving that amount every month for 2013," she says.

Start now.

Use our budget calculator to help you keep holiday expenses under control.


National Retail Federation
American Farm Bureau Federation

Gail Cunningham and the National Foundation for Credit Counseling are not an affiliate of any company of The Principal®.

While this communication may be used to promote or market a transaction or an idea that is discussed in the publication, it is intended to provide general information about the subject matter covered, and is provided with the understanding that none of the member companies of The Principal are rendering legal, accounting, or tax advice. It is not a marketed opinion and may not be used to avoid penalties under the Internal Revenue Code. You should consult with appropriate counsel or other advisors on all matters pertaining to legal, tax, or accounting obligations and requirements.

Insurance products and plan administrative services are provided by Principal Life Insurance Company, a member of the Principal Financial Group® (The Principal®), Des Moines, IA 50392.


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