Have you started shopping for that unique holiday gift, planning on which holiday parties to attend, and deciding who will host the holiday dinner this year?

The cost of gifts, the meals, and the travel can add up before we realize it. What starts out to be “the most wonderful time of the year” can often turn into a post-holiday nightmare of debt.

How can we stop this from happening? How can we afford the holiday our family deserves and still be debt-free in the New Year? Let’s start by taking a quick quiz.

Don’t panic it’s one question, multiple-choice…

How can you afford the holiday you want and still be debt-free?

A. Use your credit cards

B. Get a payday/small-dollar loan

C. Create a budget

If you chose a credit card – Nah!

Remember, credit cards are revolving credit and can start a cycle of minimum payments and maxed-out balances. By only paying the minimum, you will never pay down a credit card as they are set to a small percentage of the balance. That means you could still be paying off 2021 holiday debt in 2025.

If you chose payday or a small-dollar loan – STOP!

Payday loans in Maryland are officially illegal. However, there is a loophole called small-dollar loans.

APR rates in Maryland on these types of loans cannot exceed 33%, which means if you borrow $100, you need to repay $133 to cover the debt. The maximum amount you can borrow is $1,000, and the repayment period is 31 days. So, if you borrow the maximum of $1,000 at the beginning of December 2021, you will have to repay $1,330 by the beginning of January 2022—on top of all your other monthly expenses.

Ask yourself, “If you can’t afford it now, will you be able to afford it then?” This is the worst scenario a consumer can make. Although it may seem like a quick solution, it is a disaster for your budget.

If you chose budget – Congratulations, you have read my other articles!

The holidays come at the same time every year. Do not let them sneak up on you. Determine how much you plan on spending and start budgeting for it the year before. Personally, my goal is to purchase all my holiday gifts by August, so I start saving August of the previous year.

It is still not too late this year to have a terrific end-of-year event. Start right where you are with your budget and decide what is manageable this year. Write it down and stick to the plan. You will have more months next year for planning!

Remember your budget does not need to be stressful. It is a habit that alleviates financial surprises.

Contact me today and set up a time to go over your plan and how to best execute it. The best plans are the ones we put into motion. My calendar link can be found at https://linktr.ee/ Carlisacares.

Call Carlisa Kent Today at 240-528-1743! Zoom Appointments Available