Christmas: recommendations to make purchases and avoid getting into debt

Thousands of Peruvians are heading to make their purchases of Christmas Y New Year at the last minute, due to the extra money that falls into households as a bonus, bono, bonuses or some other pending payment that improves short-term liquidity.

Therefore, it is important, if it has not already been done, to budget for these purchases in advance to avoid spending more than necessary and getting into debt with the use of credit cards.

Luis Fernando Terry, director of the Marketing and Commercial Management career at Le Cordon Bleu University, points out that many of the Christmas purchases have an emotional motivation, where nostalgia, feelings and despair play a very relevant role; so many end up in check and out of control in their budget.

Therefore, he suggests taking advantage of offers that are not associated with consumption with credit cards. That is, take advantage of discounts and promotions for the Christmas season and postpone the use of credit.

To achieve this equanimity, the specialist shares some tips to keep in mind:

– Combine offers: Look for offers or promotions in stores, where you can also add discounts for being a member of a subscribers club, an airline, or some favorable condition (university card, for example).

– Earn points or money: Look for offers that generate a profit in miles, in money, or in points to be able to redeem them later.

– Prioritize discounts: prefers price discounts over volume promotions, especially on household products. Discounts are more profitable than block sales (3×2 or 5×4 promotions). Choosing the latter will make you have more items than you really need.

– The cheap can be expensive: buying cheaper items, but that were not necessary or are out of your budget, is not a saving, even if they are 50% off.

– Be cautious: You must be attentive to the amount of credit you have used up on your card. The monthly payments of these should never add, together, more than 40% of your personal income.

Meanwhile, Brenda Silupú, professor at the Faculty of Economic and Business Sciences of the University of Piura (UDEP), also offers some recommendations so that you can pamper your loved ones during these holidays, without affecting the family economy.

– Evaluate the interest rates of your credit cards: Keep in mind that most of these are consumer and charge high interest rates, which are activated from the second installment. However, if it is used at a fee or by the direct system, you do not pay interest; however, you must pay off the debt on the next payment date. If you have more than one credit card, evaluate which one charges the least interest and consider the billing and payment dates.

– Define a savings plan: It is recommended that you determine a percentage or a fixed amount that you must save from the income you receive. For a single person, a rate of 30% of their income is recommended; while an individual who has a family dependence must, at least, save 10% of his income. This rule is what most financial institutions consider.