The holiday season can be tough—it can drain your bank accounts and leave you in debt. But it’s a struggle that can be avoided with proper planning and budgeting.

Set a holiday budget

Many people don’t budget. And among Stash users, about 40% say they don’t put together a holiday budget.* During the 2017 holiday season, however,  U.S. consumers who went into debt to fund their holiday shopping racked up, on average, more than $1,000.

Fifteen percent are still trying to pay that debt back, nearly a full year later, according to reports.

That debt has an impact on credit scores, too. Credit utilization—the percentage of credit that you use of the total that’s available to you—is one of the main factors used to calculate credit scores. And when utilization increases during the holidays, it can have an effect—among those with an increase of 10% or more in their revolving debt balance, 57% saw a decrease in their credit score.

So, how can you plow your way through the holiday season without going into debt or sacrificing your credit score?

Step-by-step: Tips to avoid going broke and keep your credit afloat

  1. Create a budget for the holidays.

You’re probably going to spend more than usual during the holidays. Plan accordingly by creating a holiday budget (as a part of your everyday budget).

If you can save all year, having a holiday fund on standby will remove a lot of stress—and you can avoid using your credit cards.

Americans will spend nearly $1,000  on average during the holiday season this year—that may be a good figure to plan for when trying to determine how much to budget.

  1. Avoid opening new credit cards or credit lines.

Credit inquiries can appear on your credit report, and may result in a lower credit score. If you can, avoid opening up a new card. The same goes for loans. You may think that getting a personal loan can help you make ends meet, but come January, it’s more debt that you’ll have to pay off.

  1. Make all of your payments, and make them on time.

If your spending ramps up during the holidays, the last thing you want to do is miss a credit card or student loan payment, even if you’re tempted to skip payments for a month. That will only hurt you in the long run. Your payment history is the single biggest part of your credit score.

  1. Think long term.

The holidays will be over before you know it—definitely get caught up in the spirit of giving, but do it affordably. Don’t bury yourself in debt. Chances are, your friends and family can survive with smaller, less-expensive gifts if you need to pinch pennies.

Think long term. You don’t want to be paying off this year’s Christmas presents next year. So, stick to your budget, spend within your means, and do your best to stay out of debt.

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