Don’t let the holiday season set you up for debt in 2025

STATEPOINT – The holiday season may be warm, merry and bright, but it’s also a time when it’s all too easy to spend more than you plan to and rack up debt you can’t manage.

According to CERTIFIED FINANCIAL PLANNER® professionals, here’s how to celebrate the season in style while positioning yourself for a financially healthy 2025:

Create your budget: Take a look at your budget to determine how much you can earmark for holiday expenses. Do you need to cut back on any nonessential spending to afford the holiday season you desire? Make a comprehensive list of all your expected expenditures, including for travel, hosting, decorating, gifting and charitable giving.

Stretch your budget: Stretch your holiday budget creatively. When shopping online or booking travel, find the best deals by using a browser extension that comparison shops. Entertaining? Rather than providing every dish yourself, host a cookie exchange or potluck. If you have a large extended family or circle of friends that holds a traditional gift exchange, suggest a Secret Santa or white elephant exchange instead.

Maintain your credit: While it’s fun to be extravagant and give big-ticket items that will wow your recipients, your holiday spending shouldn’t harm your credit. Keep an eye on your debt-to-credit ratio throughout the season and set reminders of when credit card payments are due. If you purchase an item using a Buy Now Pay Later plan, put payment due dates in your calendar to avoid late fees.

Give wisely: Many people make charitable contributions around the holidays. If you plan to give, do it in a way that offers a tax advantage. From deductions to donating appreciated assets to using a Donor Advised Fund, a CFP® professional can help you find a strategy that is good for you and for the cause you care about.

Save all year: Diverting a small portion of each paycheck into a special savings fund all year long can help ensure you’re prepared to meet holiday expenses. Once this current season wraps up, you can begin to plan for next year.

Make your resolutions now: Whether it’s to pay down debt or set up a retirement fund, you don’t have to wait until the new year to get started on your resolutions. Get a healthy money mindset now so that come January, you’ll have already established habits that move you toward your goals.

Working with a financial advisor to prep for the holidays can help ensure you have a stress-free season. Find your CFP® professional, trained to offer comprehensive solutions for your unique situation, by visiting letsmakeaplan.org.