69% of Consumers Have Overspent on the Holidays. Here's How to Avoid That This Year

It's a mistake you should try to steer clear of.

Many of us like the holidays -- but don't like the giant credit card bills that come with them. In fact, the danger of racking up too much of a credit card tab during the holidays is carrying debt forward and starting off the new year in the red. That can be demoralizing, not to mention costly.

But the unfortunate reality is that many people do wind up with holiday debt because they inevitably wind up overspending. And it's easy to see why that happens.

There are so many different expense categories that come into play during the holidays, from gifts to travel to decorations. And let's not gloss over the endless sales that retailers put out to lure in customers. It can be very hard to exercise restraint when every time you walk into a store, half of its inventory seems to be marked down.

Plus, a lot of people are shopping with a budget these days due to inflation. So when you see items you know you'll need in the future with their prices reduced, it can be tempting to scoop them up -- even if it means spending more than anticipated.

In a recent TD Bank survey, 69% of respondents say they've overspent on the holidays in the past. And of those, 45% have overspent by $300 or more.

Much of that overspending stemmed from a good place -- wanting to find the right gifts for others. But wanting to take advantage of holiday sales was another big contributing factor.

If you'd rather not start off the new year loaded with debt, then it pays to do what you can to avoid overspending this holiday season. Here's how.

1. Put together a budget

It's hard to limit your spending when you don't have a specific number in mind that signifies "enough." Take a look at the money you have available to you in the form of your savings, money from your upcoming paychecks that isn't earmarked for bills, and gift cards you can use to cover your purchases. That should give you a total to work with.

2. Set a per-gift limit

It's nice to want to get all of your loved ones a great gift for the holidays. But chances are, the last thing your family members and friends would want you to do is take on debt and the stress that comes with it just to buy them things. So rather than do that, decide on a spending limit for each gift you're buying and stick to it.

It doesn't have to be the same limit for everyone per se, because you may want to spend more on your kids than your cousins, and that's okay. But setting a per-gift limit might make it easier to stay within your budget.

3. Remind yourself that sales happen all the time

It can be tempting to spend extra to take advantage of sales while they're around. But remember, the holiday season isn't the only time during the year when you can score discounts. So rather than get into debt to capitalize on bargains, make a list of the things you see on sale that are tempting, and then keep an eye out for discounts on them later on, when you aren't grappling with holiday costs at the same time.

Ending the holidays with debt could really put a damper on the season. Take these steps to avoid that -- and spare yourself the stress and aggravation of losing money to credit card interest.