Business Viewpoint: Holiday spending requires restraint, self-control
BY GREG GALLANT Business Viewspoint
Thursday, November 22, 2012
11/22/12 at 4:53 AM
A bike, a dog, new shoes, an Xbox, new headphones, a skateboard, and the list goes on and on. As the holiday season approaches, parents throughout our state and our nation will begin to hear about the latest and greatest items their children are counting on unwrapping before the end of the year. Lists will be given, advertisements will be cut out and subtle hints will become far less subtle.
Like most parents, when this time comes we desire to give our children those things they want. We, too, remember being a child with certain toys that we anticipated for the entire winter season and the disappointment of realizing those things were just out of our family's means. However, in an effort for us to try to keep our children from such disappointments, many Americans resort to buying and borrowing outside of our means and put our children at risk for years to come.
It is imperative that we remember our responsibility and obligation as parents to care and provide for our children 12 months of the year, not just one.
I have seen, year after year, families put themselves in financial instability through well-intended yet poorly planned budgeting during the holiday madness.
According to American Research Group Inc., Americans plan to spend an average of $854 in 2012 for holiday-related gifts, in spite of continued economic uncertainty and increasing household debt. It is troubling to think of the number of homes that have been foreclosed or the amount of families that spend a year cutting back on groceries, all due to the emotional consumerism of the holiday season.
We have come to expect that we will spend more on gifts, food and home décor during these final months of the year, but it is important to keep in mind that with the exception of potential holiday bonuses, the amount of money coming in usually remains consistent with that of the 11 months prior.
There are a number of financial advisers who have given their tips on how to avoid holiday-season debt, and all of their advice is valuable. You will hear about the importance of saving early, setting a budget and leaving the credit cards at home. All of these are prudent and crucial steps in avoiding the "holiday hangover."
Yet what I would like to leave with you is something a bit less tactical or tangible. I am simply calling for a return to stewardship and sensibility. As a father, I have great dreams for my children. I hope to be in a financial state that I can help provide for their needs, education and future goals. The last thing I want to do is to sacrifice their college-fund safety net for the sake of a new iPad.
The nation's biggest shopping season is upon us. The retail giants and shopping malls will be packed with holiday shoppers. This is all fine and is a staple in American culture. However, I ask that we all remember that a new big-screen television does little good in the home when we struggle to pay the electric bill.
Original Print Headline: Holiday spending requires restraint, self-control
Greg Gallant is the CEO of Tulsa Federal Credit Union. The views expressed here are those of the author and not necessarily the Tulsa World. To inquire about writing a Business Viewpoint column, email a short outline of the article to Business Editor John Stancavage at john.stancavage@tulsaworld.com. The column should focus on a business trend; the outlook for the city, state or an industry; or a topic of interest in an area of the writer's expertise. Articles should not promote a business or be overly political in nature.
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