10 Things to Do Now to Avoid Holiday Debt Later

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Kmart made headlines recently as the first retailer to advertise for holiday shopping. While it may seem ludicrous to think about the holidays before the summer season officially ends, it’s actually smart to get started now. In fact, the National Retail Federation found that 40 percent of consumers started holiday shopping before Halloween in 2013.

Even if prepping for the holidays makes you feel green, following these 10 tips will help you stay out of the red this shopping season.

1. Sell your stuff.
While spring may be synonymous with cleaning, fall is also a good time to declutter and sell anything you no longer want especially since you can stash the earning away for gift shopping. Large items like furniture is best sold through Craigslist or via local Facebook buy-sell-trade groups. Clothing can be sold at local consignment shops or online at RecycleYourFashions.com orthredUp.com. Finally, you can sell old gadgets for cash through Gazelle.com or NextWorth.com.

2. Track flights.
If you’re flying over the holidays, it’s wise to start looking into flights now. Typically, the sweet spot for the best airfare deals is six to four weeks before your desired departure date, but the holidays are another animal. As you begin researching, use the “flexible date” feature to compare rates among departure and return dates. This will help you pinpoint the cheapest dates to fly and lock in your time-off request early. Don’t forget to track prices using Yapta.com; this way, if you notice the flight price drop after you book, you can request a credit from the airline.

3. Buy discount gift cards.
In addition to being the most highly-requested gift for seven years in a row, gift cards can actually save you money when you buy them at a discount. Websites like GiftCardGranny.com have thousands of gift cards to popular retailers, with savings like 25-percent off Starbucks gift cards. You can also sell any unwanted gift cards for cash, and get up to 92 percent of the card’s value back to put toward your holiday shopping budget.

4. Eliminate excess spending.
Whether it’s weekly takeout, weekend spa appointments or too many morning lattes, there is always room in your budget to cut back and boost your holiday savings. Review your spending over the past several months and identify areas where you can cut back. Keep in mind, some of the excess purchases you eliminate now doesn’t have to be forever.

5. Stash your savings.
Whenever you skip a spending opportunity, put what you would have paid into a savings account specifically for your holiday shopping budget. You can open a Christmas Club-type account at your bank or local credit union, or go online to SmartyPig.com, a free service that helps you stash away cash for any purpose. Ultimately, putting your savings in a place where it’s not easily accessed will help you avoid dipping into it for unrelated purposes.

6. Anticipate hidden costs.
Budgeting for gifts and travel is a no-brainer, but often we forget about the hidden costs of the holidays. Things like postage for holiday greetings, White Elephant gifts for corporate parties, or tips for all the helpers in your life. It’s these expenses that send our budgets in the red, so prepare for them now to avoid surprises. Holiday packaging can be purchased on the cheap from dollar stores, while White Elephant gifts can be a re-gift from something you already own. For advice on tipping etiquette, check out these guidelines from Emily Post.

7. Consider side hustles.
Now is a great time to look into earning extra cash. This will help you avoid living on Ramen Noodles until after the holidays, plus it might expand into a legitimate gig beyond the holiday season. Sites like eLance help you find companies in need of freelancers, while TaskRabbit connects you with people who need assistance with small tasks like grocery shopping, dog walking or handy work. If you have the flexibility, a part-time retail job not only offers extra cash but also an employee discount for gifts.

8. Round up your rewards.
Between social events, back to school shopping and family getaways, you likely racked up quite a few points on your credit card over the summer. Use those points to offset your holiday spending by turning them into gift cards. You can give these cards as gifts or use them to pay for gifts at specific stores. Sometimes, credit card companies will offer these reward gift cards at a discount, so keep your eyes peeled for these deals.

9. Start scouting and collecting gifts.
Now is a good time to start scouting for gifts and note their selling price. If you find a really good deal right now, buy it! Picking up a few gifts over the course of two to three months will limit the financial strain you may experience when buying multiple presents during the peak shopping season. If you’re researching online, be sure to look for coupon codes from sites like CouponSherpa.com to score discounts or free shipping.

10. Research layaway thoroughly.
The main reason for early holiday shopping ads is to promote retailer layaway programs. While putting coveted items on hold and paying them off over time seems like a good strategy, you need to be careful about the program’s fees. Startup and service fees can range from $5 to $10, and if you need to cancel for any reason, there’s a fee for that, too. Stores like Walmart do not offer layaway for online items, nor do they price match in-store items with their online prices, meaning you could pay more for a gift than you need to.

Andrea Woroch is a nationally-recognized consumer and money-saving expert for Kinoli Inc., who helps consumers live on less without radically changing their lifestyles. From smart spending tips to personal finance advice, Andrea transforms everyday consumers into savvy shoppers. She has been featured among top news outlets such as Good Morning America, NBC’s Today, MSNBC, New York Times, Kiplinger Personal Finance, CNNMoney and many more. You can follow her on Twitter for daily savings advice and tips.