INDIANAPOLIS — Elaina Bowlds leaves the store Monday afternoon with a few gifts in hand.
"A candle, a fun Christmas decoration for a friend," she points out.
She's planning out what she's buying for family and friends this year.
“I work in retail, so I’m constantly aware of how much I’m spending on things,” Bowlds said. “But I mean, I try to even out the amount I’m spending on each person, so that way I can budget things.”
Other shoppers say they’re also keeping budgets in mind — though not always strict ones.
“But not a strict budget,” said Mary Ann Schlegel Ruegger. “Kind of generally like -- what have we spent in past years and a little bit of talking with each other -- what are we all comfortable with."
Those conversations are key when it comes to managing holiday debt.
“If it’s something that’s going to have to be a debt months into the future, then it’s not in our budget,” said Ruegger.
According to NerdWallet, 31% of holiday shoppers who used credit cards last year still haven’t paid them off a year later.
“We found that 10 percent of this year’s holiday shoppers are paying back debt that they took on over multiple holiday seasons,” said Sarah Rathner, a credit card expert with NerdWallet.
Rathner recommends making a spending plan now — comparison shopping, watching for sales, and setting a budget that includes all seasonal costs.
“Even the cost of hosting and entertaining, because these types of expenses can add up to thousands of dollars depending on how you choose to celebrate the holidays,” she said.
Rathner said credit cards can still be useful tools, as long as shoppers pay them off quickly. They can offer purchase protection, help with fraudulent charges, and even extended warranties on certain items.
“If you don't have credit card debt, you can earn rewards," she added.
But she cautions against buy now, pay later plans.
“If you aren’t careful, it’s easy to get in over your head,” Rathner said.
Rathner also encourages families to talk about the role of gift-giving in their celebrations.
“We found that 63 percent of shoppers felt like their holiday celebrations with their loved ones are too focused on getting gifts,” she said. “But only 20 percent have started this conversation with their loved ones or intend to.”
