Picture this….the holidays are over. The decorations are down, the plethora of empty boxes and wrapping have disappeared. The refrigerator is finally empty of left overs. Family and loved ones have returned to their homes….and you aren’t facing a mountain of credit card debt from the holiday season!
While you may be well into your holiday shopping, using cash to "wrap" up (or start for those last minute shoppers) is a great way to cap off the holiday season. You see analysts from ShopperTrak predict that sales from Super Saturday (the last Saturday before Christmas) will be larger than those on Black Friday!
While the question “paper or plastic” is routine at the grocery store, it’s also one that you should ask yourself in regard to your holiday shopping. And much like you can save the environment by using paper at the grocery store, you can “save” yourself by using “paper” in your holiday shopping this season!
- Identity Theft. I don’t know about you, but the recent increase in security breaches with major retailers is wearing me out. And if the “big guys” don’t have the resources and intelligence to protect my personal information, it stands to reason that I’m even less protected with the mom and pop style shops. Sure most credit card companies offer fraud protection, but do you really want (or need) the hassle of trying to fix that mess?
- Stay on Budget. Call me a scrooge but I think the words holiday and budget should be used in the same sentence more often. Without a defined budget, it’s all too easy to lose track of your spending. And many folks find themselves paying for this Christmas next Christmas. Pulling out the “green stuff” (yes it still exists!) hurts just a little bit more than the plastic. Consequently, we think more before we spend.
- Reduce the Impulse. How many times do you think you are done with your shopping, only to decide to add “just one more thing?” I know that I personally find impulse shopping close to the holiday to be one of my worst offenses. With that said, there’s certainly nothing wrong with getting in the spirit and deciding to spoil “little johnny” with just one more gift…but paying with cash is a great way to limit this behavior. When you are out of cash, it’s time to quit!
- Clean Slate. By definition, the New Year means a chance to start fresh. But it’s tough to have a fresh start when you begin the year by facing a pile of credit card debt from a holiday that is soon forgotten. Instead of starting January by figuring out how to pay for those gifts that were too quickly forgotten, you can focus on chasing your dreams for the coming year. If you are interested in becoming "Debt Free" in the New Year, check this out for more tips.
- Interest Kills. While you may have great intentions of paying off your credit card debt each month, most people end up paying interest. According to Creditcards.com 50-60% of Americans fail to pay the full balance on their cards. Paying these fees isn’t in your “best interest.” In fact, the only one that benefits is your credit card provider. These fees can easily range from 15%-25%. So in reality, that $100 gift you purchase for your niece quickly costs you $125.
- Help the Little Guys. Providing credit is a large (and profitable) business! Card companies make their profit through interest charged to consumers and to fees charged to retailers. While it can vary, a 2% fee to business owners is pretty standard. Major retailers have the additional fees included in their cost and overhead calculations, but smaller and independent retailers often cover these fees from their profits. So paying with cash is a direct benefit to the “little guys,” their bottom line…and ability to stay in business!
- No Guilt. While we all dream of seeing the enjoyment on our loved ones face when they open the “perfect gift,” it’s even better without the guilt of knowing we couldn’t really afford it. Paying with cash removes the guilt and leaves those special moments for just what they are…priceless!
I’d love to hear from you…will you be paying with paper or plastic this Christmas?