Local financial expert warns about panic spending as Christmas shopping deadline approaches

Maybe you've finished with your Christmas shopping, but there are plenty of folks who haven't.

 

With Christmas Day fast approaching, people tend to panic and overspend. Joe Foster, President  and CEO of HALLCO Community Credit Union, said it happens every year.

 

"I found a poll from 'Magnify Money' and it said that Americans added over a thousand dollars - $1,054 to be exact - in 2017 in Christmas debt. That [amount] is going up year after year and a lot of that is due to panic spending," Foster said.

 

He said the best practice when it comes to Christmas spending is to budget early, but this late in the game, it's really too late for a budget. Foster said, if nothing else, be extra careful about racking up too much credit card debt.

 

"Just an example - if someone has added $1,000 in credit card debt, even at our low rate of 7.9, at $25 a month, it would take four years to pay off the credit card debt. You know, if it was your standard rate of 18-percent, you would pay over $300 in interest," Foster said. "I don't know about you, but I'm not excited about taking four years to pay off a pair of Nike tennis shoes or that Red Ryder BB gun."

 

While Foster is a banker and not a counselor, he has some advice for shoppers who resort to overspending as gift-giving season bears down.

 

"The pressure this time of the year to buy that perfect gift is really more of just an emotion - the feeling that people get - forgetting that giving that perfect gift is just a temporary feeling. The best advice I could ever give is that it's the spirit of Christmas and making memories with family and friends that lasts forever," Foster said.

 

Of course, as a banker, Foster is practical about spending, and he suggested that shoppers who find themselves in a last-minute bind this year should think ahead to Christmas 2019. He said HALLCO Community Credit Union even has the "old-fashioned Christmas Club account" that works like a charm.

 

"It's a great way to budget and plan for Christmas. We have thousands of people each year that in November we transfer the money out of their Christmas Club account into their checking account," Foster said.

 

Foster said Christmas is just one more life event - one that rolls around each year - that people should plan for financially.