Financial consultant and author Tony Jackson.

Many of us look forward to the holidays, especially this year, with all the economic woes.

News headlines have been inundated with stories of high inflation, increased gas prices, rising interest rates, and a declining stock market – events that have placed millions of Americans under immense financial pressure.

You may be one of the many who need a break. We have spent much of the last few years isolated, quarantined, wearing masks, and frankly, we are looking for a sense of normalcy. Thank God for the holidays! This year, my family had the opportunity to gather for Thanksgiving. It felt good to be together, enjoying food and fellowship.

The day after Thanksgiving is known as Black Friday because it is the day retailers' annual accounts “go into the black.” It is the busiest shopping day of the year and marks the beginning of the Christmas shopping season. It is followed by Small Business Saturday and Cyber Monday.

In fact, according to Fit Small Business, over 196 million shoppers spent an average of $325 over the annual shopping weekend this year (https://fitsmallbusiness.com/black-friday-cyber-monday). So even amid a tough economy, consumers still set records related to shopping and spending money.  

Bank of America CEO Brian Moynihan told CNN, “Americans are still employed, they still have money in their bank accounts, and they’re still spending that money.” Perhaps many of them are falling prey to retail therapy. Retail therapy is the act of shopping, usually to make oneself feel better or to improve one’s mood.

Regardless of the reasons behind the increased spending, we must take steps so that we don’t fall into the holiday money trap.

With that said, here are a few tips to help avoid overspending and falling into the holiday money trap:

1. Make a budget and stick to it: Knowing how much you can afford to spend on gifts, food, and other holiday-related expenses will help you stay on track. The bottom line is to be strategic.

Know whom you are buying for and how much you will spend.

2. Avoid using credit: If you can't pay for something with cash, you probably can't afford it. Using credit to finance holiday spending can lead to debt and financial stress.

Remember, everything you charge in December will have to be paid in the new year, and if not paid before interest accrues, you could quickly be spending a lot more than you intended.

3. Shop around for deals: With a little planning and research, you can find great deals on gifts and holiday essentials. You can google “Christmas gifts for under $25” to get great economical gift ideas for your family and friends. Visit websites like Google Shopping, Capital One Shopping, and Honey to compare prices.  Also, remember to search for coupons and discount codes on Coupons.com, Groupon.com, and RetailMeNot.com.

4. Don't let peer pressure dictate your spending: Just because your friends and family spend a lot doesn't mean you have to do the same. Be wary of advertisements and commercials that get you to spend, spend, spend.

Stick to your budget, and don’t be pressured into spending what you can’t afford, even for your kids or grandkids. Take some time to consider your purchases.

As we approach these final days before Christmas, I also want to challenge you to be creative with your gifts. Consider gifts other than toys or material things that can’t be broken or set aside by the new year. One year my wife and I gave our children a book, “The Richest Man in Babylon,” because we wanted to provide them with something that would advance their mindset.

Another year, we gave them stock through Stockpile.com. Stockpile is an excellent gift idea, mainly because we want to encourage our circle of influence to have an investor mindset rather than a consumer mindset. With Stockpile, you can give investment increments of $25, including stock in Apple, Nike, Tesla, or various cryptocurrencies. There is also investment educational information on their platform.

Tony Jackson is a financial consultant, author and radio program host on Praise 11.9 FM. Follow him on YouTube, where you get podcasts, and on social media @therealmoneycoach for more financial tips.

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