he desire to please loved ones through gift giving can be hard to resist, but giving into emotion could like to financial problems.

“Emotions drive all the spending that people do for the holidays,” said Allison Gibbons, professor of Family and Child Studies at McNeese State University.

“There are the positive feelings of love, friendship and gratitude that people want to express to one another through gift giving. Emotions of family ties also make people travel to be with loved ones at Thanksgiving and Christmas. Feasts have historically been used for celebrations, and feasts involve having an abundance of specially prepared meals at these times, and inviting others to share the meals with us. It so happens that gifts and feasts mean that extra money is needed.”

Emotion can lead to bad decisions.

“The negative side of the emotions mean that we may have feelings of shame, guilt, failure and inadequacy at these times if we cannot participate in the gift giving and festivities because of lack of money,” Gibbons said.

“Many people feel depressed around the holidays for these reasons. Therefore both positive emotions as well as negative emotions drive us to overspend and max out the credit cards during the holidays. The idea of gift giving in religious tradition involved some sacrifice — that is, you do without something for yourself so that you can give to someone else. Also, the cost of the gift was not important. Unfortunately, some of those ideas have gone out the window, and we end up wanting to impress others with the cost of the gift, and we also have our eyes on items for ourselves as well.”

Using credit to purchase gifts can also lead to long-term problems.

“If your credit card bill for purchases made during last year’s holiday season is not yet paid off in full by this holiday season, then you are overspending and will only make your debt situation worse by adding more expenses to the credit cards for this year’s holiday season,” Gibbons said.

“If last year or the year before, you borrowed money from friends, relatives, took an advance on your wages or salary, took out a car loan to be able to spend freely for the holiday season, and those loans have not been repaid before this year’s holiday season, then this year your strategy must be different and you have to approach the holidays differently where your enjoyment of the holidays with family and friends is not based on how much money you spend.”

Stores will often tempt customers with credit offers during the holidays.

“People should avoid the lure of taking out new store cards during the holidays just for spur of the moment shopping for things you cannot afford,” Gibbons said.

“Ideally, credit cards should only be used to tide you over until the end of the month. Of course many people need more time than this because their income cannot support the things they want to buy. In that case, they should budget in a way that whatever credit they use for the holidays, can be paid off completely before next holiday season. Remember that you need to figure in the interest rates as well.

“The downside of this 12-month payback system is that there is no guarantee that you will have a job come January. Saving a similar amount of money every month for a year prior to the holidays will be the better plan. Maybe skip the high-level gift giving for this year and begin saving so that from next holiday season, you will be on a plan where you will always have a holiday savings account and avoid credit altogether.”

Poor decisions during the holiday season will leave problems that last long after the celebrations are over.

“Overspending causes emotional, social as well as financial problems. Whenever we overspend, we have buyer’s remorse, guilt and possibly late emerging depression,” Gibbons said.

“Being a shopaholic is a psychological problem all by itself. Financial problems mean that you can get into the type of trouble through which you can incur a bad credit report, owe thousands to loan sharks or pay-day loan agencies, your salary in the future will never be yours because all of it goes to a credit card or the loan shark; people have lost their cars and homes due to overspending. Loans are not forgiven just because it was Christmas or Thanksgiving, or you thought it would be nice to buy an iPad for your 3-year-old.”

(mgnonline.com)