With the holiday shopping season just a few short months away, shoppers should be aware that the recent financial changes to banking fees and credit cards courtesy of the Durbin Amendment may be changing the way people shop. Not only do consumers have to budget extra cash for higher banking expenses in general, there also appears to be no relief for consumers in the stores.
Changes Not In Store for Retailers
The Durbin Amendment has limited the price banks can charge for interchange fees on debit card purchase transactions. Where banks could once charge 44 centers for each transaction at the register, they are now limited to only as much as 24 cents for each transaction. This puts more money back into the pockets of retailers and consumers may have a notion they will be able to save some cash during the biggest shopping season of the year.
However, changing in retail prices doesn’t seem to be on the minds of said business owners. There will be a greater need for consumers to start saving much earlier and spending more decisively for the upcoming shopping season. In addition to the gifts, food, and sundries that go along with holiday traditions, consumers will also be paying more for their used-to-be-free checking accounts, debit transactions, and ATM cash withdrawals before even hitting the malls.
Reforming Your Budget
While there are only a few months to go before holiday festivities, it is not too late to start reworking your budget and setting savings goals toward the holiday in addition to managing your regular financial life.
It will be important to check in with your bank and be clear about any new fees being passed on to customers so that you’ll know what to expect. If you have received bank literature make sure you read through all of it or visit with a local branch manager to get the information you need for a successful budget. It may also be the right time to shop around for smaller banks or credit unions that are still offering incentives and benefits to customers.
Tips for Revamped Savings
There is still time to make changes to your financial situation to be ready for the holidays. Here are some tips to help you make an easier transition to a new budget and still be able to afford gifts for giving:
Cut Back to Increase Savings
There should be at least one or two things on your spending list that you can do without in order to stash more cash for the holidays. Just a few bucks a day tucked aside over the next few weeks can give you extra cash for holiday spending. Even if you don’t have a Christmas Club account or an established savings account for the upcoming occasions, you can make some temporary sacrifices to save now.
Consider Alternative Shopping Methods
There are still some retailers that allow you to put merchandise on layaway with no additional finance charges. You can hold the items for a small down payment and then make incremental payments until the time limits runs out and you need to pay the remaining balance to collect your merchandise. Don’t forget about online shopping sites where merchandise is priced lower than retail stores. Just be cautious about the shipping charges you may incur which could cost more than the gift itself.
Discount and dollar stores have certainly stepped up their game in the last few years. With larger selections of merchandise, you can find something for nearly everyone on your list at much more reasonable prices. Many stores carry brand named goods including food, snacks, home décor, and are usually chockfull of holiday decorations and necessities. Start collecting items now so you don’t need to have a lump sum of cash on hand to cover your list.
The economy has hit America hard and there are many without jobs and those struggling with debts. It is completely appropriate to suggest to family and friends that cutting back on gift-giving might be a good idea. Not only can this suggestion help you save on cash and avoid stress, you may very well be helping family and friends who are afraid to mention their own hardships. Consider name-swaps or secret Santa exchanges where gifts are smaller and less pricey. For dinner time get-togethers, consider a potluck style affair where everyone brings something rather than one family footing the whole bill.
While there doesn’t seem to be an end in sight to the changes in the financial industry or the banking sector, consumers can still find incentives, deals, and discounts if they practice creativity and a little out of the box thinking. It will also require a renewed emphasis on better budgeting habits to accommodate the rising costs and fees that are on the horizon for consumers.
About Tisha Tolar is a financial writer for MyBankTracker.com, a site that helps consumers compare savings accounts, CD rates, and home equity loans to make informed banking decisions and save money.