Keep Your Hands off That Credit Card!
Call me Scrooge, but I think Christmas is more about spending time with family and the birth of Jesus than a bunch of presents.
This of course makes me remiss to admit the commercial side of Christmas is more popular than ever.
According to the National Retail Federation, the average American spent $1,050 on Christmas this year, up from $1,000 last year, and that number has been marching steadily higher over the last decade.
Honestly, I think most people spend too much on Christmas gifts.
I say that because most Americans — a pathetic 45% — have absolutely zero savings.
None. Nada. Zilch. Zip!
Another 24% of Americans have less than $1,000 saved. So we’re talking about almost 70% of Americans with less than $1,000 of savings who are also spending over a thousand dollars on Christmas presents!
Something has to give…
It’s always a mistake to live above your means and that is especially true for baby boomers who should be saving for retirement instead of lavishing their family/friends with Christmas presents.
Get this: according to GOBankingRates 12% of Americans 65 and over have less than $1,000 in an IRA or 401(k) For Americans aged 60 to 64 it’s 8%.
The irony is that your generous acts of gift giving may be setting the stage for you to become a burden on your children later in life.
If you can’t pay your bills, you could be forced to move in with your children or ask them to pay for things you can no longer afford.
A Savings Lesson From the Lord Almighty Above
And nobody wants to be in that situation:
See, I am ready to come to you a third time, and I will not be a burden, because I am not seeking your possessions, but you yourselves. For children should not have to save up for their parents, but parents for their children.
– 2 Corinthians 12:14
Money is a difficult subject to talk about, especially for families, and your children may not know that you’re behind on retirement savings.
I bet that if you explain your financial situation to everyone in your family, they’ll happily support a decision to spend less on gifts and more on retirement savings.
For me, I treasure the handmade Christmas ornaments and Crayola crayon pictures my daughters made for me in grade school more than anything they’ve given me as young adults.
And most of all, I treasure the time we spend together.
The best things in life truly are free.
Here’s to growing your wealth,
Chief Income Expert, Mike Burnick’s Wealth Watch