4 Holiday Shopping Mistakes to Avoid in the Homestretch
With just over two weeks remaining, last-minute shoppers may be starting to feel the noose of the December 25th deadline circling around their necks when it comes to gifts. But coming up empty-handed now doesn’t mean consumers won’t pay a pretty penny for what eventually lands in their shopping carts.
According to the National Retail Federation’s (NRF) holiday spending survey, consumers are ready to fulfill longer wish lists. The average shopper will spend $749.51 on gifts and other holiday incidentals, which is a 4 percent increase over last year’s figure of $740.57.
When the Federal Reserve reports that the average household boasts $15,328 in credit card debt, shoppers need all the help they can get to cut these holiday expenses, which many are vulnerable to in the final weeks of December.
“People forget how to think about money logically and next thing they know they just racked up a ton of credit card debt and burned through their savings,” says Steve Siebold, author of How Rich People Think.
In order to get through the Christmas chaos financially unscathed, consumers should consider how the right preparations and precautions of everything from payment behaviors to online habits can impact their bank account.
Avoid these last-minute holiday shopping mistakes with a few expert quick fixes.
Getting Caught Up in the Moment
The holiday season is the primary time of year when such a huge emphasis is placed on what consumers buy—and retailers are only fueling the fire.
“Retailers get people to part with their money at the holidays by tapping into the emotional side of the shopper, and it works because most people look at money through the eyes of emotion at the holidays,” says Siebold. “Stores are decorated like the North Pole and a beautiful Christmas Village, and on top of that the advertisers play it up that the doorstopper deals are just too good to be missed, and people buy into it.”
The fix: Find a way to slow down.
Before purchasing that next impulse Christmas gift, have the strength to walk away for a time period.
“Since time is more limited during the holiday season, try to follow a ‘2 week rule’, or a ‘1 week rule,’” says Leslie H. Tayne, financial attorney and debt management specialist. “Taking the step to leave the store without buying the item could help you realize whether or not the item is really worth a trip back to the store and could curb your temptation to overspend.”
And if shoppers lack the willpower to put down the last in-stock item, they may need to take more drastic measures—like having someone they trust along with them to talk them down or buy the gifts for them.
Relying Too Much on Credit
Plastic can be an all-too-powerful spending weapon to put down during Christmastime. Overspending one’s budget or maxing out a card’s credit limit can spell a dangerous debt trap, only made worse by the interest rates of carrying a balance.
“The buy now pay later concept is an oldie but a goody for creditors – yet poses dangerous ground for consumers,” says Tayne. “Risk of overspending is much easier when using credit and is more difficult territory to cross when using cash.”
The fix: Budget and tread carefully with card choices.
Siebold says having a budget in place this time of year is essential. He advises to calculate how much money one needs for essentials like rent, insurance and car payments before determining what to spend on loved ones.
Consumers can also be proactive about paying for what they do spend, by putting aside the cash to pay for items before the card statement even comes.
For shoppers using a zero interest card to ease the season’s financial hangover, Tayne advises to have a plan in place before that period ends to avoid any retroactive high interest fees once it ends.
Paying Unnecessary Costs
When shoppers are racing against the clock, paying a higher price for convenience often wins out over searching for the best bargain. But Becki Dilworth, Director of Online Marketing for ShopAtHome.com suggests you can have convenience at a deal.
“It’s easy to get distracted by the sights and sounds of the holiday season and go overboard on your holiday spending budget,” says Dilworth. “Impulse shoppers are likely to overspend when they don’t check for coupon and Cash Back deals. A quick search on a coupon search engine site like ShopAtHome.com can keep holiday shoppers within their budget and help them find the best deals available.”
The fix: Exercise that search engine.
Dilworth suggests that something as simple as searching for the hottest holiday toy’s coupon code can give shoppers a deep discount without having to fight the crowds or stand in lines.
She adds that one of the season’s biggest faux pas is giving in to paying for shipping. Find those retailers that are offering no minimum purchase stipulations along with expedited shipping after the 17th—those deals are out there, and shops are participating in these sweet deals to win shoppers’ attention.
Neglecting Online Security
The holiday rush also becomes a breeding ground for unwanted attention from hackers ready to pounce on sensitive consumer information made vulnerable by the wrong mouse click. Unfortunately, they’re easily equipped to outsmart shoppers.
“Cybercriminals are trendier than you might think, and where the crowds go, they follow,” says Marian Merritt, Internet Safety Advocate for Norton. “Holiday shopping season is of particular interest because criminals know there will be lots of valuable information exchanged, like credit card numbers and other valuable personal information. Knowing that people may also be anxious to find the best deal possible makes planting a scam that much easier for the bad guys.”
Merritt says cyber crooks employ a variety of evolving and slick tactics including setting up a fake fan page or offer “Like” on Facebook, which prompts you to fill out your login credentials. Malware can even make its way to text messages.
The fix: Stay one step ahead when online shopping
The potential for a great bargain is never worth the risk of jeopardizing one’s identity or personal finances. And a little consumer savvy before opening the internet browser can help.
First, Merritt advises to stick to familiar sites. In the address bar of these sites, look for HTTPS and make sure it’s highlighted green. The lack of an “s” and a red color means there’s no security in the exchange of personal information.
Second, avoid the age-old trick of using the same password for everything. While it may be convenient, cracking one account means online thieves can crack them all.
Also, steer clear of shopping on public Wi-Fi, where hackers are ready to snatch up data.
“Wait until you get home and are on a secure network to put in your credit card info, or think about using a personal VPN to keep your private info private,” Merritt adds.
‘Tis the season to spend, but it can also be the season to save cash, too. When shoppers can keep their cash under closer wrap in the midst of holiday euphoria by tweaking their existing habits, they just may have what it takes to ring in a healthy financial New Year.
If you use these quick fixes and still find your post-Christmas bank account needs a little boost, learn the right way to borrow online with Click N’ Loan.
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