Learning About The Pitfalls Of Holiday Debt And How To Avoid It

At Missouri Title Loans, Inc., we know just how special the holidays are. It’s that time of the year when we all get to spend time with our loved ones, travel for leisure, and exchange presents. However, the holiday season can also be stressful to many because of its high costs.

As a result, many choose to borrow or spend money they don’t have to cover gift and travel expenses, leading them to fall into significant holiday debt. Holiday debt has many pitfalls that can affect your finances in the short- and long-term. Let’s discuss these and how to avoid them this holiday season!

The Pitfalls Of Holiday Debt

Many Americans cannot afford the holidays' expenses, but many choose to take on debt to get through the season and provide for their family. According to a study conducted by Lexington Law, 57 percent of Americans with children say they’re willing to take on debt to provide for their children and make them happy during Christmas.

The debt typically comes in the form of overspending using high-interest credit cards, borrowing money through a high-interest personal loan, and using personal savings for emergencies.

The pitfalls of holiday debt include:

• Financial Strain: Holiday debt can lead to stress and financial strain as repaying the funds, primarily if incurred through high-interest loans or credit cards, can have a long-lasting impact on your economic well-being.
• Credit Score Impact: Maxed-out credit cards and late payments can negatively impact your credit score, making it difficult for you to secure favorable terms on credit applications, loans, and mortgages in the future.
• Limited Financial Flexibility: A significant holiday debt can limit your flexibility in the months ahead, keeping you from pursuing other financial goals like saving or investing.

Top 5 Ways To Avoid Holiday Debt

But fear not; the holidays don’t have to end with a mountain of debt - follow these helpful tips to ensure that you enjoy the festivities without going over budget:

Tip # 1 - Set a Budget and Stick to It

The best way to not overspend is by setting a strict budget and ensuring you don’t exceed it throughout the season. List all the people you intend to gift and calculate how much you can spend per person.

Creating a holiday spending plan that includes travel, lodging, parties, gift purchases, etc, would also be helpful. If you projected that the expenses would exceed your budget, consider trimming your spending. 

Tip # 2 - Choose Meaningful Gifts

People think that the pricier the gift, the better it is. But the holidays are all about things meaningful, so this year, focus on giving thoughtful gifts instead of expensive ones. If you must purchase a gift, consider ordering them online before prices increase for the holidays.

Tip # 3 - Host a Potluck Christmas Party

If you’re hosting a party this season, consider going for a potluck setup. Your friends and family would find it fun, and it can lower your stress and expenses from preparing an elaborate Christmas feast all on your own.

Tip # 4 - Put Up A Garage Sale

Have you been wanting to declutter all year? Now is the perfect time! Make this an opportunity to tidy up your home and, at the same time, earn extra cash to spend for the holidays. Alternatively, you can sell unused items to local thrift stores or online.

Tip # 5 - Find a Seasonal Job

Working a side job is another excellent way to earn extra money this holiday season. During the Christmas season, the demand for labor is up, plus most seasonal jobs are part-time and low-commitment.

Getting A Title Loan for the Holidays: How It Works.

Sometimes, more than the funds are needed, even after budgeting and trimming expenses. If you need some fast cash to fill in the gaps in your holiday spending, consider getting a title loan from us! 

At Missouri Title Loans, Inc., you can have your title loan process started in two easy ways:

Online

There’s nothing more convenient than starting your loan application online. All you have to do is fill out our online form and get the process started! We will give you a call shortly to get the rest of the details. Once approved, one of our representatives will meet you at your chosen location to verify your documents and inspect your vehicle.

After finalizing, you can expect the money in your bank account within one business day.

Visit One Of Our Branches

Alternatively, after starting your loan application here on our website, our representatives will call you for other important details. You can visit one of our Missouri Title Loans, Inc. locations, where one of our representatives will review your vehicle and help you complete your application process.

Once approved, you will get the cash, regardless of your credit score.

Get Your Title Loan Today

Avoid significant debt this holiday season by starting a title or signature installment loan from us! It’s easy, convenient, and hassle-free - precisely what you deserve during the holidays!

 

Note: The content provided in this article is only for informational purposes, and you should contact your financial advisor about your specific financial situation.