Sensible spending? Sensible advice?

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YOUR MONEY ADVISER

Tips for Paying Off Your Holiday Credit Card Debt

Experts suggest everything from following a three-month repayment plan to selling used clothes and toys or temporarily reducing your 401(k) contributions…

The financial website MagnifyMoney found that just under half of consumers said they had taken on debt this holiday season — an average of $1,325, up 8 percent from last year — and most won’t be able to pay it off in January. (The online survey of 1,120 consumers was conducted just before Dec. 25.) Source: New York Times 1-6-2020

One comment

  1. temporarily reducing your 401(k) contributions…- DO NOT DO IT!!!!

    Some quick math for a 30 year old. $1325 invested at 4% would equal $5228 at age 65.
    35 years of inflation and you would need $3230 to replace the buying power of the $1325 that you used to payoff your Christmas debt, more if inflation is higher than the last 35 years.

    I spend nothing for Christmas and did not spend much even when i had 4 children at home.
    A friend once asked me why I did not buy my kids bikes for Christmas, like other parents in the neighborhood. Living in Montana what good is a bike during winter. I always purchased stuff for my kids throughout the year, not just because of some holiday. Never spent more than a couple of hundred dollars during Christmas. Since 2009, when my youngest child left home, I have spent nothing on Christmas. When my wife and I need something, of course we buy it at that time, not when some so called “special” day arrives.

    For someone who wants to have money for Christmas, why not start a Christmas account in Jan, deposit $100 per month then on December 1st you would have $1200 and zero debt. Of course today almost no one saves for anything. So called experts, who needs them, I have made it 64 years without them and now with the internet good formation is available for free.

    Liked by 1 person

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