A man shopping at home in a savings account.

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It may not be a bad idea.

Key Point

  • Many feel the pressure of inflation and are making sacrifices for it.
  • Reducing your vacation expenses may make sense if you’re spending more than you’re earning, or if you simply feel like you’re short on money.
  • If you don’t want to give up your vacation spending, you can take a side job or cut other parts of your budget to cover those costs in the short term.

Holidays are always an expensive time. However, this winter, due to inflation, your credit card balance may increase significantly during the holidays.

Inflation is forcing consumers to spend on everything from food to apparel to travel. In fact, according to MassMutual’s recent Consumer Spending & Saving Quarterly Index, the problem is so acute that 38% of Americans are thinking of cutting their vacations.

If you love vacationing, the idea of ​​taking less vacation time may be upsetting — and rightly so. The question is, should we take fewer holidays this year, or find other ways to deal with inflation?

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When you have no choice but to truncate

For example, let’s say you are in a difficult financial situation. Your monthly living expenses are higher than your income, your emergency funds are in short supply, and your credit card balance has grown significantly since the beginning of the year. If you can’t afford to spend extra money on things you don’t need, it may make sense to cut back on holidays.

However, you don’t have to ruin your vacation just because you’re short on cash and don’t want to add to your credit card debt. For example, instead of having him host 15 people on Thanksgiving, you can host his dinner at a potluck where everyone brings food. And instead of spending hundreds of dollars on Christmas presents, you can give handmade presents for a fraction of the cost.

if you can afford it

Let’s say you cover monthly bills (but have little or no monthly balance). Let’s say you have some savings and pay off your credit card in full every month despite inflation. You may be worried that a hefty holiday tab will drive you into debt. That could mean staying local instead of paying to travel, lighting the decor instead of spending hundreds to light up your home, and sending electronic cards instead of printed holiday cards. there is.

Now, if the holidays are really your favorite time of year, you might be able to indulge in the usual hoopla if you can make other changes to your personal finances. You can have a side job for a month and use the income to pay for your vacation if money is tight. Alternatively, you can spend more on holidays, but you can cook 100% at home in the months leading up to your vacation so you don’t pay extra for restaurants or takeout.

In fact, the public holiday only comes once a year. And if you want to enjoy them in a familiar way, there may be options for saving on gifts, canceling parties, and not missing out on opportunities to spend the season with loved ones.

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