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4 Ways You Can Eliminate Holiday Debt From Your Future

piggy bankThink it is too early to think about holiday debt? It is not! September is here and before you know it, you just breezed over October and November. Once the 9th month comes in, you need to realize that you should be thinking about how you will spend your money during the holiday season.

If you want to prevent debt during the holidays, the most important thing that you can do is to start preparing for it early. A little bit of planning will never lead you astray. What you have to realize is that the big expense that you make during the Thanksgiving to Christmas season should never take you by surprise. But guess what? A lot of people oftentimes find themselves unprepared for this.

According to the data shown in an article from DailyFinance.com, 55% of Americans who were surveyed in September of 2013 were not saving for the holidays. It is not really a common practice to do so. Why? Because we all know that we can rely on your credit cards to pay for the expenses that you will make. While this is convenient, it is not always the safest way to make purchases.

The same article revealed some disturbing data that indicated how some parents are willing to take on holiday debt just to buy their children some gifts for the season. 57% of parents are willing to make this sacrifice. But as gallant as it can be, it is also a sacrifice that is unnecessary. Those who earn less than $35,000 are willing to be in debt for up to $700. In fact, 31% of American consumers do not have a spending limit on their holiday buying.

We need to stop the habit to starting our New Year with debt. If you really want to eliminate holiday debt from your future, you have to realize that early planning is the key. If you have yet to act on your holiday expenses, then do not waste any more time. You need to start getting your act together.

4 step plan to avoid incurring debt during the holidays

Fortunately for you, there are ways to control holiday spending. Do not rely on your willpower alone. Make sure you prepare yourself so that you will stay out of any unnecessary holiday debt.

Here are 4 ways that you can avoid this type of credit.

  1. Set a holiday budget. First of all, calculate how much you will spend during the holidays. Most of this will go to gifts that you will give to family and friends. List down all the people you will give to and set a budget for each. If you can identify the gift so you can be specific about the amount, that would even be better. But apart from the gifts, you should also consider other expenses like the household decorations, meals and any travelling that you will make. If you will go on a vacation with the family, make sure that amount is included in your holiday budget. Try to find out all the hidden holiday costs that you will encounter. That way, you will not be surprised by any unexpected costs.
  2. Figure out where you will get the money. Do you have a bonus coming up? If you will depend on this Christmas bonus, make sure that it is sure. If not, you may end up with a long list but no money to pay for them. The safest way is really to save up for it. If your expenses will be too big that you cannot save for it in time, then decide how you will boost your income to make sure you can finance it. Make your credit cards an emergency back up plan. If you can save up for it in cash, that is what you should do.
  3. Decide on your payment method. Once you know where you will get the money, you can now decide on how you will choose to pay for your holiday spending. Will you pay for it using cold hard cash? That will help you stick to your budget because once the cash runs out, you can no longer spend. Or will you use your debit card? That can also work because it will protect your cash from theft. You can also decide to use your credit card for the rewards. But make sure that you will not touch the cash that you saved up so you can pay off the debt as soon as the bill arrives. In case you prefer the convenience of a debit or credit card, make sure that you know how to protect yourself from identity theft. According to Bloomberg.com, Home Depot joined Target and Neiman Marcus Group in the list of data breach victims. Be smart and vigilant whenever you intend to use your card in any purchase.
  4. Find out how you can cut back on costs. If possible, keep on reviewing your list to see if there are somethings that you can cut back on. For instance, check if there are people that you do not have to give gifts to. Also, check out sale events and take advantage of the savings that you will get from them.

By following these steps, you should be able to eliminate or at least, minimize the holiday debt that you will incur this coming season. That way, you do not have to worry about the money that you will spend. And you can enjoy the holiday knowing that you do not have any lingering debts to pay off after the season is over.

What usually causes too much holiday borrowing

When you are making your financial plans for the holiday, try to concentrate on these two expenses.

  • Gifts. We have mentioned that this is the main expense that you will make this season. If you can think of making homemade gifts, that should allow you to cut back immensely on your budget. According to data from PewForum.org, 6 out of ten Americans planned on giving homemade gifts during the 2013 holiday season. More women opted for this gift giving solution to keep their spending low. Since you are starting early this year to prepare for the holidays, you have more time to make your gifts from home. If you can paint or have a talent for arts and crafts, then that is something that you may want to utilize. If you plan on baking goodies for your friends and give them as gifts, that is also something that you may want to prepare ahead for. Buy the ingredients in bulk if they can be stored without expiring immediately.
  • Travels. Whether you intend to celebrate the holidays in a different country or with your folks in another state, you may want to prepare for this too. You can save on vacation expenses if you book your travel ahead of time. The early bird promos are usually offered months before the actual travel. You can also arrange to stay with family and friends to save on accommodations. Looking at your options early on will allow you to choose properly and not grab whatever is available out of desperation.

Your holiday spending does not have to be met with a dreadful feeling. If you prepare for it well, you do not have to worry about holiday debt.

In case you decide to use your credit card, make sure that decision will not end up in debt. If you think you cannot save up enough money to pay it off immediately, you still need to make a payment plan so you can settle that debt as soon as you can. Here are some tips from a CNN Money video about how you can deal with your holiday debt.

How To Get Financially Fit For The Holidays

man stressed with papers and calculator

If you’re like us and have a lot of people to buy for and only a modest amount of money for gift giving, you need to start working out (on your finances) to get financially fit. And now is not too early to get started. Black Friday is coming up, followed by Cyber Monday. So if you want to avoid a holiday hangover today is definitely a good time to start preparing for the 28 days of holiday shopping madness.

Develop a budget

The first step in keeping your holiday spending under control is to make a budget. You should have four categories – one for gift giving, one for travel (if appropriate), one for food and one for entertainment expenses. Many people end up in trouble because while they create a budget for their gift giving, they tend to forget about food and especially entertainment expenses. Make sure you also include miscellaneous expenses like babysitter fees, gasoline and eating out more frequently.

Make a list

Next, make a list of everyone you plan to gift, including loved ones, children, teachers, friends, your hair stylist, the guy who delivers your morning paper and so on. Then set a realistic spending limit for each person on your list along with some idea of what you will give that person.

Don’t feel pressured

When you’re making that list, don’t feel pressured to give to give a gift to everyone. If your finances are on the tight side, you might give some people a hand-written note expressing your appreciation for their help. A note or another hand made item (think home-baked cookies) can mean a lot more than some cheap knickknack you buy at your club warehouse or dollar store.

Keep on keeping on

Keep working your way through your budget and make sure you set aside some money for unexpected expenses. For example, you might receive a gift from someone who wasn’t on your list and you need to have some extra money to cover this. Did you save your receipts or credit card statements from last year’s holiday shopping? These could help you develop a realistic budget for this year’s gift giving, entertainment and food expenditures.

Think how you will pay for everything

You will definitely need to think about how you will pay for your holiday expenses. It’s always better to pay cash than to use a credit card. When you use cash you will know when you’re holiday spending is over, which is when you don’t have any left. This is a great way to keep from overspending. In comparison, it’s easy to go over budget when using a credit card. The problem is that paying with a credit card doesn’t feel the same as when you pay with cash. It’s just somehow easier to pull out a credit card then to take cash out of your wallet. If you do pay with a credit card and fail to keep careful track of your charges, you could be in for a very nasty surprise when January rolls around and your credit card statement arrives. You could use a credit card to pay for some of your expenses so long as you don’t spend more than you can pay off when that statement shows up. In fact, if you know your account’s closing date, you could get nearly 50 days of credit free just by not charging anything until the day after it closes.

Use a layaway plan

Many stores now offer layaway plans. One of these plans could help you score a big savings when you don’t have the cash in hand to pay for an item. You could take advantage of that great bargain but then spread the payments out over the next month. If you decide to do this, make sure you understand the store’s policies and keep careful track of all your payments.

Plan ahead

Don’t make the mistake of going holiday shopping without a plan. Carefully review store ads and have a list of exactly where you will go and what you will buy. It’s easy to know what to buy these days as virtually every store posts its ads online well in advance of its actual sales. As an example of this, we get notices almost every day of deals in the form of emails from Amazon, Best Buy and Staple’s.

In comparison if you just go to a store and start wandering around looking for gift ideas, you could easily end up making impulse purchases or items that were not in your original budget. If you need to “window shop” do it at home using online catalogs or store ads so that you’ll know exactly what you’re going to buy when you walk into a store.

Make stuff

If you have a really tight budget, consider making some of your gifts. Many people would be happier to get a home made gift than something cheap you bought at a discount store. Depending on your skills and abilities, you might be able to create a personalized necklace or bracelet, paint a portrait of the person or hand-carve a miniature figurine. You say you don’t have the skills to do this? Then maybe you could make a photo book or a personalized T-shirt or make something like cookies or home made candy.

Avoid temptationwoman showing her hand

Holiday sales can be very tempting especially when you walk into a store and see some cool item for 70% off. But resist the temptation. If the item isn’t on your shopping list, just don’t buy it. Make sure you stick with your original budget at all times.

Resist the perks

You’re probably carrying at least one credit card that includes rewards in the form of points or cash back. If so, you’ve probably already received notification of “double” or even “4x points” on certain things. While it can be tempting to whip out that card when dining out, buying stuff on Amazon or purchasing groceries in order to earn those juicy points, don’t let this bust your budget. We have one credit card with cash back but when you do the math, we get one cent for every dollar we charge. This means that to get $100 cash back we would have to spend $1000. Remember that the bill for that spending will come due– in the form of your next month’s credit card statement. And that no deal is a good deal if you can’t afford it or if it’s not in your budget.

About those credit cards

While it’s always better to pay cash we understand that credit cards can be an easy and convenient way to pay for things. If you use them responsibly they create paperwork that can be used to create a budget (as noted above). In fact, in this case they are actually a bit better than cash. However if used irresponsibly, credit cards can turn become a huge nightmare. You could end up having to pay interest charges of 19% or even higher and be in debt for years. If there is a reason why you must use credit cards, try to pay off your balances every month. Failing this, at least make more than the minimum payments required. We saw one example recently where a person had $10,000 in credit card debt at 13.10% / If he were to make only the minimum payments each month it would take him 27 years to pay off the $10,000 and he would end up paying back $21,271.

Think about a balance transfer

If you are carrying high interest credit card debt one of the things you might do before the holiday shopping season is transfer your balances to a 0% interest balance transfer card. There are cards like this available where you would be required to pay no interest for as long as 18 months. This could give you a sort of “ timeout” period where all of your payments would go to reducing your balance. If you were able to heavy up on your payments you might even have your entire balance paid off before your interest-free period expires.

Frugal Holiday Challenge: Are You Ready To Stay Out Of Holiday Debt?

light bulb with dollar signYou know you are getting old when the holidays do not bring you the same joy anymore. We reach a certain age wherein the gift giving season is no longer met with enthusiasm for the new things that we will receive. Instead, you meet it with a sense of dread because of the expenses that you know you will have to bear.

Well you do not have to ruin the season because you can put yourself through a frugal holiday challenge. The goal this season is to give as much as you can to family, friends and co-workers without spending more than the budget that you will set for yourself. It may seem impossible but not when you plan for it. In fact, the key to control holiday spending is to make sure that you have planned and prepared before acting on it.

Shoppers are serious about cutting back on holiday spending

According to the National Retail Federation, consumers are seriously trimming their holiday budgets to help keep themselves from holiday debt. A frugal holiday is not about giving cheap gifts, it is taking more time to think about what gift will be the most valuable for the recipient.

The NRF.com news release last October 16 mentioned that consumers are now more cautious than ever in their shopping techniques. This survey happened during a time when the economy is still full of uncertainties. Based on the survey, the NRF forecasted that consumers will be a little more conservative when it comes to their holiday shopping this 2013.

Here are the highlights of this report.

  • The average holiday shopper expects to spend around $737.95 – lower by 2% compared to the average in 2012 which was at $752.24. This is to be spent on gifts, decors and other holiday-related expenses.

  • 29% of survey respondents indicated that their shopping behavior will be influenced by the government shutdown and debt ceiling issues. 32.7% of people within the ages of 55 and 64 years of age believe that their holiday shopping will also be affected by these current economic conditions.

  • 79.5% of holiday shoppers are determined to lower their holiday spending in 2013.

  • Self-giving is said to decline this year as survey results show that the average self giving budget is now $129.62. It went down from $140.43 in 2012 and $137.17 in 2011.

  • The bulk of gift giving will be devoted to the family with an average expected spending of $415.50 – which is slightly lower than $423.36 in 2012.

  • Gift giving beyond family members will reach $72.14 for friends and $23.59 for colleagues.

  • Food and candy allowance will average at $100.35, flowers at $21.12 and greeting cards at $28.03.

  • Shopping schedules based on the survey are as follows: 41.2% before Halloween, 38.8% in November, 16% during the first two weeks of December and 3.9% will wait until the last minute to shop.

Source: http://www.nrf.com/modules.php?name=News&op=viewlive&sp_id=1682, NRF survey conducted by Prosper Insights & Analytics on 6,415 consumers between October 1-8, 2013.

Based on the details of this survey, frugal holiday shopping is strong in the minds of consumers this year. With the scare coming from the government shutdown and the debt ceiling, you can’t really blame them for trying to enjoy the season without crippling their bank accounts. In fact, the survey further notes how retail sales and discount schemes are helping consumers decide where to shop and what to give out as gifts – at least 35.6% of them.

Tips to make gift giving less expensive

The survey conducted by the NRF proves that frugal holiday planning is trending this season. So do not fret if you want to cut back on your holiday spending – everyone else will be doing it! We have not turned into a land of cheapskates but we are starting to be more financially responsible and practical too.

So how can you join this trend? Here are some steps that you can follow.

  1. Use a budget. No financial planning is ever complete without a budget. Create a list of the one time expenses that you will spend on this holidays and add it up with the usual monthly expenses. Total the amount of income that you have and tap into your savings if you had been saving up for this season.

  2. Set a budget amount for your one time expenses. List the names of the people you will give gifts to (from priority to the least). Make sure that you include costs for your travel, meals or any other expense that you will make while shopping.

  3. Research for sales, discounts and deals. Do you research online but prioritize the ones that you can get from your local store. It’s great to get a discount from an online store but if you have to spend so much on shipping, the discount might be wasted. Also, it is better to be able to see the item before buying it – that way you can check it for defects, etc.

  4. Schedule your shopping escapades. Try to group together shopping errands to save on gas and to time it with promo events. Also, make sure that you stick to the plan without buying anything extra for yourself just because something is on sale.

  5. Take advantage of any freebies. Be on the lookout for freebies because this will save you a lot. Some people fail to notice that gift wrapping are sometimes free in certain retail stores. This will end up saving you some significant amount of money so do not ignore them.

  6. See what you can recycle as a gift. Sometimes, there are gifts given to you that you do not need anymore. You may want to consider giving them to someone who you know will enjoy it more than you. Just be careful who you will give it to.

It helps to use a holiday budget calculator to help you keep track of what you are allowed to spend. We found a great online calculator on PracticalMoneySkills.com. You can list your budget for gifts, food and even travel. You can pattern your budget template on this and add or remove details as you see fit.

Gift ideas you can make at home

If you really want to save yourself from holiday debt, you may want to start thinking about gift ideas that you can make at home. You don’t have to worry about beating the holiday rush if you create your own gifts. There are so many things that you can do and we have divided the recipients of your gifts into groups.

For the family

First on your list are probably your family members. For your spouse or partner, a great idea is to come up with coupons of services that you can do for them. For instance, one coupon entitles them to a free massage or a week-long of free dish washing.

For your children, one idea is to melt all their small crayon stubs to create one big crayon that you can form into their favorite shape. Add a coloring book and it should be a great new drawing tool for them. You can also make their own personal soap shaped like a toy or something that they will love to use. Or you can create a toy box for them – if you have the carpentry skills at least.

For friends

Finding gifts for friends can be generic or it can be something unique for each of them. One great idea is to bake them some cupcakes or cookies, put it in a plastic container and secure it with a ribbon. That should be a great gift for them. Or you can also make the service coupon. Give your couple friends with a babysitting or a lawn mowing coupon that they can claim once a week. It should be fun to do things for your friends.

Another great idea is a small calendar with photos of you and your friends that you can layout creatively and print in color. Tie them together with a ribbon and give it to friends to use in the office or their home.

For co-workers

Anything that you think they can use in the office should be a great idea for a gift. A place to put their phone or pens is a great idea. Or you can buy coffee mugs in bulk and decorate them uniquely based on the recipient. If you really want to be economical about it, go to the local beach and pick up cute shells or go to the park to look for decorative stones. If you are the arts and crafts type, you can probably decorate these to be a paperweight for your office mates.

Here is video from Money Talks News about tips on what you should not buy this November.

Credit Card Strategies For The Holidays

woman with a laptop and holding a credit cardThe holidays will soon be upon us and with the holidays comes holiday spending or in some cases overspending. We all like to give gifts and sometimes we get carried away. It just feels so good to see all those big smiles as people open our gifts. But then comes January and those credit card bills. Those statements can really be a pain. But there are some strategies you could use with your credit cards during this upcoming holiday season and here are four of them.

#1: Pay all  statement balances each month

You’re always better off if you can constrain your holiday spending to whatever amount you can pay off in full each month and on time. This generates several benefits. First, you would not have to worry about high interest rates because you’re not accruing any interest at all. Second, you would enjoy an interest-free grace period on all your charges that would be 20 to 50 days depending on when you charged the item in your statement cycle. If you play your cards right, this could give you nearly two months of credit at zero interest cost.

#2: Don’t get new credit cards

If you find that you must carry a balance, make sure you continue to use your normal credit cards so that you would be incurring interest charges at the usual rate. Applying for new credit cards will not only harm your credit score but can come with very high interest rates. For that matter, if your credit score decreases, your interest rates will increase. Carrying a balance forward may be acceptable so long as you can pay it off within the next several months. But whatever you do don’t miss a payment. Missing just one payment on one of your credit cards could lower your credit score by as many as 60 points. And this could drop you from having “good” credit to “poor” or even “bad” credit.

#3: Look for a 0% interest balance transfer card early next year

If you find you’re over your head in credit card debt, apply for a 0% interest balance transfer card early next year. If you can qualify for one of these cards, you won’t have to pay any interest for anywhere from 6 to 18 months – depending on the card. This would give you a sort of timeout period where all of your payments would be used to reduce your balance, which could help you get caught up on that Christmas spending. However, make sure you understand that new credit card’s terms and conditions. Some of these cards charge a 3% fee on the amount of debt you transfer. If you were to transfer, say, $5000 to a 0% balance transfer card, this could cost you $150. This is something to just be aware of.

Get that promotional credit card offer before the holidays.

If you feel you will be creating debt over the holidays, you could apply for one of those 0% credit cards that have interest-free financing on new purchases for some period amount of time. Just make sure there is no balance transfer fee. That way you could carry a balance, while avoiding both balance transfer fees and interest charges. Because these offers can last as long as 18 months, you could potentially finance your purchases for this holiday season and the next one as well.

Which of these makes the most sense?

As any expert will tell you, the best way to use a credit card is the pay off your balance in full every month. If you do this you’re using your credit card as a helpful method of payment and not as a way of finance or to create debt. Beyond this, the 0% interest balance transfer cards can make sense if you can pay off a portion of your debt each month before your promotional period expires.

Keeping that holiday spending under control

It’s also important that you try to keep your holiday spending under control. There are several strategies for doing this as well.

First, you should set a limit on your total holiday spending. Determine what it is that you can afford to spend, combining both the cash you have in hand and what you can afford to put on your credit cards. Then stick to that limit.

Give less expensive giftsSmiling woman hugging sack of groceries

Second, create a budget based on your own finances and not what it is you would like to do. The people on your list will probably appreciate the less expensive presents you buy them as much as more expensive stuff. It’s definitely true that it’s the thought that counts.

Make your gifts

There’s just nothing that beats a homemade Christmas gift where you’ve not only put thought into it but your time and efforts as well. Anyone can buy a Christmas gift. But it takes a special person to make them. It’s also great to give personalized gifts. Instead of shopping at those expensive, trendy shops, take a moment to think what the people on your list could really use. As an example of this, suppose you have a friend who loves to bake but can’t seem to ever do homemade piecrusts right. You might buy her an inexpensive pastry-making tool for less than $10 and then wrap it up with a copy of some foolproof recipe. You can just imagine how much she would love the gift and yet you’ve spent next to nothing.

Collect coupons and coupon codes

You may be able to find some very good sales before the holiday season, especially those legendary Black Friday sales. But there are other ways to save money on your gifts. For example when you’re shopping online, first do a quick web search for coupon codes that you could use on your favorite online stores. Also, comb through the coupons you receive in your mailbox before hitting the mall. Don’t forget to comparison shop. It’s possible save anywhere from $10 to $100 on an item just by watching out for deals. Speaking of which, here’s a video loaded with good tips for shopping online.

4 Tips To Help Control Your Holiday Spending

man swimming in debtMost of us look forward to this season because of the many festivities, exchanging of gifts and the overall camaraderie that it brings. However, there is one thing that we dread: the holiday spending.

In the past, we plunged blindly into the holidays, spending our money left and right while making excuses that it is all for the spirit of the season. Then, when the festivities are over, the good feeling quickly vanishes as we are faced with the statements that carried proof of our holiday debt.

Here’s the truth: it does not have to be that way. This is one of those times when shopping and saving becomes a real challenge but it is not impossible to stay away from overspending during this time of the year.

4 ways you can keep holiday expenses from putting you in debt

All it really takes to keep your holiday spending from ruining your post season mood is some preparation and planning. And it does not even involve new tricks. These are habits that we used to do and now it is time to use it specifically this season.

  • Be organized for the season. The first is simply to get yourself together and plan what you want to happen. Get your calendar and take note of the important activities that will happen in the next few weeks. Things like when is the company’s Christmas party and when your house guests are scheduled to arrive for the holidays (e.g. siblings, parents, etc). List what you need to prepare during these times so you are not caught unaware. Create your gift list and the grocery list for any food and house items that you have to buy. You should also take note of special dates like when your holiday vacation will start. Make sure you have given your gifts to colleagues before this date. All of these lists will help you keep tabs on all the activities and preparations that you have to accomplish. It will keep you from forgetting important purchases and hopefully avoid unexpected expenses.

  • Determine the costs involved and how you can afford it. When you have organized what needs to be bought, done and attended to, it is time to assess how much the holiday spending will cost you. Not only that, you have to know how you will fund all of it. Assess your finances and see where you can save to make room for the expenses that you have to meet during this time. Check if your credit card can offer rewards and other freebies. Take advantage of all of these if you can.

  • Make a budget. As soon as you have the list of expenses and you means to pay for them, it is time to organize everything in a budget. This is not too complicated because there are online budget templates that you can use to help make this plan. You can use the one from PracticalMoneySkills.com or you can download a template online. Allot a certain amount for each expense and make sure that you stick to it.

  • Choose how you can tighten your spending. With all of these information check how you can lower your spending to avoid putting yourself in debt because of the holidays. If there are gifts that you can do on your own, then that is what you should do. If there are expenses that you can forego, then you may want to think about cutting back to keep yourself from the need to use credit for some of your holiday spending.

These 4 tips should help you control the money that you will spend to make the holidays as enjoyable as possible.

Retailer efforts to make you spend more this holiday

The holiday season is a time where retailers will be trying to get the most out of shoppers. If you are trying to live on a budget to keep your spending down to a minimum, you have to learn how to practice smart spending. Given that, you need to be wary of the different techniques that retailers implement to encourage you to buy more than what you intended.

Here are some of what we have observed.

  • Reach a price mark and get a discount. Retailers love to offer discounts but only if the consumer reaches the required price. For instance, if you buy up to $150, you get 20% off on your purchase. This is a technique to get you to spend more than the planned purchases just so you can take advantage of the discount.

  • Putting great looking and expensive items beside sale racks. Another technique is putting expensive items right where the sale items are. Since people will automatically go to sale racks, putting other items that are usually better looking beside it will get the attention of consumers. Sometimes, it is placed in a way that you will think that it is part of the sale. When you reach the counter to pay, you will find out that it is not on sale after all. Going through the decision making process will make it more likely that you will go through the sale anyway.

  • Demonstrations. This is a proactive way for stores to get you to pay. Sale people doing the demonstration are trained to entice you to buy – even if you did not plan on buying it in the first place.

  • Product in the checkout area. As you are waiting for your turn to pay for the stuff that you got, have you ever noticed that there are a lot of items before you? These are small items that you really don’t need but standing next to them for quite some time will get your attention and entice you to buy them. This is one of those techniques used by retailers so be careful about them.

When you are out buying stuff, just make a list and stick to it. If there is something that you think you want to buy, give yourself time to think about it.

4 Important Issues In The Financial Market This Fall 2013

After everything that happened in the past few years, we all learned how to be more conscious of our finances. The whole idea is to achieve financial stability. When we reach this financial state, we are more secure even if a crisis will occur. That includes paying off our debts and making sure we save as us money on interest. Not only should we concern ourselves with our debts, we also have to think about growing our income.

The financial market is one of your concerns if you want to know how you can grow your income. It is very important to understand how it operates so you can maximize the investment options that you have chosen for yourself. We are all encouraged to increase our income and diversify it to protect each of our investments.

4 concerns of the financial industry come October

man falling off a chartWhether you have invested or not, it is important that you monitor the financial market. It is defined by Wikipedia.com as the place where consumers and businesses can trade commodities, financial securities and other items of value. These exchanges are usually done with a lower cost. Since everyone is transacting in this market, consumers and businesses are able to compare costs so they can get the best value and return from their investments.

What you have to understand about the financial market is that it can quickly change on you. This is why you have to monitor it constantly so you can make smart decisions about your money.

To help you achieve this, we have compiled 4 different issues that should concern you if you wish to survive the financial market this fall of 2013. These are the different issues that you need to keep a close eye on.

  1. Shaky economic recovery. Evidently, the government shutdown and the debt ceiling are keeping things at a standstill this October. The economic recovery, as more people will agree, was never stable to begin with. It was, at best, slowly but steadily increasing. Definitely, it hasn’t fully recovered yet. But with the standstill in the government and the legislators unable to meet their deadlines, it seems like our economy could suffer another setback. This will not bode well for your investments and you should try to see how this will affect your profits. That way, you can make smart decisions about where you will put your money.

  2. High interest rates. This is actually a scenario that credit and lending companies will seriously start to consider. Part of the issues that will definitely come into the limelight is the loan guarantees that the government is offering so consumers can get better interest rates in their credit accounts. If the government proceeds to pull out this support, people will have to deal with high interest rates. If you have a loan interest rate that is constantly changing, this could be a problem for you. It can compromise some of the assets that you are paying off.

  3. Government default. Of course, another concern is the debt default that the government will be falling into. October marks a lot of deadlines for the House and Senate and if they cannot reach an agreement with the budget and the debt ceiling, a default on the government debt payments may not be far from happening. This can cause taxes to rise and that can jeopardize the net income that consumers will take home. A lot of scenarios can happen because of this. It can lead to less credit and spending – which will affect businesses in general. Stock values can fall and that can affect your own investments too.

  4. Shopping season. The Fall season is leading up to the shopping season because of the upcoming holidays. This will bring us a lot of temporary highs. We will see an increase in job opportunities as retail businesses will puff up their manpower. Consumers will increase their shopping budget in response to the gift giving season. These are all temporary and while it may be a good thing for those who will get jobs, you have to be very careful about the expenses that you will incur. Never remove the current economic conditions from your consciousness and keep a tight grip on any credit that you want to make.

All of these financial market issues are pretty involved with each other. Although there is a chance that it will not be as bad as we think it will be, it is still best for us to make the necessary steps to take care of our finances.

How to enjoy your holidays despite the country’s shaky financial condition

Definitely, you want to plan ahead when it comes to your holiday spending. While we all want to join in on the good spirits of this season, you have to be very careful about your financial decisions to make sure that you will not go overboard. What the financial market is telling you this fall is that you have to avoid holiday debt at all costs. Here are some things that you can do to make this happen without feeling left out this season.

  • Make a list of the people you want to give to this season.

  • Start shopping as early as possible. The holiday rush will increase costs and you can find better deals off season.

  • Remember that you do not have to buy a gift for everyone. The gift giving season corrupted our minds into thinking that we should give everyone who you think will give you a gift. Give only to the people you want to give to.

  • Great gifts does not have to be expensive.

  • Buy things in cash – avoid buying in credit if you do not have to.

These are only a few of the things that you can do. If you can make your own gift, that may even cost less and allow you to give to more people.

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