According to MagnifyMoney, Americans who went in to debt for the holidays added an average of $1,054 to their credit cards, store cards, with some even taking out personal loans, payday loans, or a home equity loan.
We did not add debt this holidays, but instead my main Christmas gift to my wife was a meaningful contribution to a brand new SEP IRA account from my consulting work over the second half of the year. Truth be told, 2017 was a bit of an unexpected roller coaster financially. Since August, however, we have tracked every penny both in and out, created budgets and kept to them, eliminated a number of unnecessary expenses, and shifted business costs off our personal accounts. Even though there have been weeks and months of tough conversations that were less than enjoyable, it certainly feels good now to be on this side of the equation, with no intention of flying blind again.
To me, the most terrifying sentence in the findings from the survey by MagnifyMoney is that: "For most shoppers, going into debt wasn’t the plan. According to the survey, 64% of those who have holiday-related debt didn’t plan to incur it. And lack of planning, whether it’s for holiday spending or other types of debt, can lead to financial problems down the road."
I'm glad I was not part of the 64% (or even the 36% who did plan on going into debt for holiday spending). It is much better to be part of the other non-percent who are planning for the future instead of selling it now for something that seems so important. The holidays are after all far more about presence than presents.
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