Yahoo Finance Don’t Be a Turkey: Avoid These 8 Common November Money Mistakes
It’s November, and with Halloween in the rearview mirror, the holidays are fast approaching — and temperatures are dropping.
See: 8 Ways You’re Wasting Money at the Grocery Store
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While it’s easy to get swayed by the holiday spirit and overlook expenses, experts say that there are a few mistakes you should try to avoid this month. With sticky food inflation and high energy prices, it’s important to remain vigilant and have a plan to not only be able to enjoy this season, but to also aim at starting the new year on a good financial footing.
Don’t Buy at Full Price: Have a Budget and Look for Deals
With family gatherings, holiday meals, and holiday shopping coinciding, it’s no wonder that many people tend to lose track of their budgets. Often, this leaves shoppers starting the new year with less savings than they had in mind, said Joe Camberato, CEO of NationalBusinessCapital.com.
“In terms of shopping, we all want to find that perfect gift, but it’s not always easy on the wallet. The key here is smart shopping. One of the best moves you can make is to spread your shopping list throughout the holiday season,” Camberato suggested.
He added that savings don’t stop with Black Friday.
“This year, businesses are getting more creative with sales, starting them early and keeping them going longer. In fact, some of those post-Cyber Monday deals might even beat the prices you’d find on those initial days,” he said. “Remember, while it’s okay to hold off on big-ticket items, you could save on smaller items, and those savings add up over time.”
Don’t Crank up the Heat
Cranking up the heat the moment it gets chilly is another money guzzler. Layer up with sweaters and blankets before touching that thermostat, said Jeff Rose, CFP and founder of Good Financial Cents.
“The Department of Energy suggests you can save as much as 10% a year on heating by turning your thermostat down 7-10 degrees for eight hours a day from its normal setting,” added Rose.
You can also save big by only heating necessary places, according to Kate Colarulli, head of strategic insights at CleanChoice Energy.
“Don’t waste energy while doing the dishes or your laundry,” she added. “Use cold water to wash your clothes, hang your laundry to dry instead of using the dryer, and turn off the heated drying setting on your dishwasher to save a surprising amount of energy.”
Finally, she recommended sealing your air ducts, as leaky air ducts can reduce the efficiency of heating systems by up to 30%.
Don’t Lose Your Employee Benefits and Don’t Rush Through Your Enrollment
Another November no-no is forgetting to maximize your annual benefits, said Rose.
For instance, If you have a flexible spending account (FSA) or other benefits that don’t roll over into the new year, use them before you lose them.
An FSA is an employee benefit that allows you to set aside money, on a pre-tax basis, for certain healthcare and dependent care expenses, as the National Institutes of Health explained.
“According to a study from WageWorks, over $400 million is forfeited back to employers each year because employees don’t use their FSA dollars in time,” added Rose.
This year, open season for FSA enrollment starts Nov. 13 and ends Dec. 11.
Doug Ornstein — CFA and senior integrated solutions manager for TIAA Wealth Management — echoed this sentiment, reminding people to avoid rushing through annual benefits enrollment.
“Whether it’s Medicare or enrolling in supplemental life insurance through your employer, spend the time to make the right decisions today to avoid headaches in 2024,” he said.
Don’t Forget About Your Subscriptions
Forgetting about subscriptions and memberships is also something you should keep in mind this month.
“Before the year ends, review all your subscriptions and memberships. Cancel any services you no longer use or need to start the new year with a cleaner slate and potentially lower monthly expenses,” said Andrew Latham, CFP and managing editor at Supermoney.com.
Don’t Miss Smaller Winter Expenses
Many begin to travel during November as the holidays kick off. As the colder months start, be sure that your car is prepared for the colder weather.
“Simply making sure your tires are inflated properly could add significantly to your gas mileage and help reduce your fuel costs during the holidays as you go to visit family,” said Lawrence Sprung — CFP, founder and lead wealth advisor at Mitlin Financial.
Don’t Be Frivolous About Your Portfolio
There are a few mistakes you can make this month that will end up costing you a lot. For instance, TIAA’s Ornstein stressed the importance of not withdrawing or borrowing money from retirement accounts to pay for holiday spending.
“Your family will remember the memories you made together, not the stuff you bought them,” he said.
Another no-no, according to him, is to “take investment advice from your cousin at the dinner table.”
“People love to share the stories where they had success but rarely talk about the times they lost money on a hot stock or other investment,” he said. “Nod and smile if you must and find a trusted financial advisor for planning and investment tips.”
Don’t Sit on Losing Investments
“You may be able to harvest losses to offset future gains and this needs to be done before year end. Harvest time isn’t just for pumpkins and turkey,” he added.
Don’t Say Yes to Everything
Give yourself a pass and say no instead of putting financial pressure on yourself. Interest rates are at a high and inflation continues to impact how much Americans are spending on day-to-day expenses, according to Shinobu Hindert, CFP and author of “Investing Is Your Superpower.”
While hosting Thanksgiving (or Friendsgiving) is a great way to spend quality time with people you love, it can also put a dent in your wallet. So, instead of saying yes to bearing the weight of most expenses, ask friends and family to chip in — either with a potluck, or to contribute to a Thanksgiving Fund. This can be as simple as people sending you whatever amount is comfortable for them.
“Be open and honest when talking about money. Chances are someone close to you is wanting to express this but may not know how,” said Hindert.
Bonus Advice: On Using Credit Cards
According to Hindert, there’s another aspect Americans should be cautious about when starting this month.
“Many Americans receive year end bonuses in December so throwing a few extra expenses on the credit card in November might not seem like a big deal,” said Hindert. “This can snowball into the New Year if you don’t properly account for all your spending during the holiday season. Going into the New Year with high interest credit card debt is stressful so try to pay for things in full as you go where possible.”
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This article originally appeared on GOBankingRates.com: Don’t Be a Turkey: Avoid These 8 Common November Money Mistakes
