On average, Americans will spend $983 for holiday gifts this year. For those pressed for funds, even a fraction of this amount can create a new year filled with the stress of buyer’s remorse, exorbitant credit card bills, and insufficient funds for necessities.
Such problems overwhelm many college students just as a new term begins. Stress is the number one impediment to academic success in college. And the top two reasons why college students drop out are their need to work and earn money, and their inability to pay tuition and fees.
But you, as a parent, can help your student avoid overspending on holiday gifts.
First, manage expectations before the gift exchange. Thoughtful gifts don’t need to cost a lot. Tell your student he need not buy expensive presents. Quietly remind family members he can’t afford to spend a ton and, if your family members share holiday wish lists, lobby for some low-cost items he can afford.
Second, coach you student to establish a realistic gift budget fitting his limited finances, omitting gifts to casual friends, and dedicating a certain amount for each person on his list.
Retail businesses are exceptionally good at separating consumers from their money. So help your student avoid getting hoodwinked by marketing strategies designed to entice more spending than he can afford — constant sales, decoy pricing, loss leaders, loyalty cards, retail credit, etc.
Counsel your student to minimize extra fees — convenience fees, credit card fees, service charges, shipping costs, etc. Paying with cash or a debit card can avoid some of these fees. Comparative shopping can help avoid or diminish others, especially if shopping online.
Encourage him to limit self-gifting — i.e. treating himself to something while shopping for others. Whatever he’d buy can probably go on his holiday wish list.
Urge him to pick up some seasonal work to earn a few bucks that’ll help cover gifts and other holiday expenses.
Advise your student to track holiday spending. It’s helpful to establish a gift budget, but only if he stays within it. Tracking his expenditures, which simply requires a pencil and paper, helps him do this.
Finally, remind your student that spending restraint is critical to a truly happy new year!
College Affordability Solutions can provide other strategies for helping to keep your student’s costs low. Feel free to call (512) 366-5354 or email email@example.com for a no-cost consultation.