Getty Images We all know that the end-of-the-year holiday season can be a financial killer, what with costly Christmas or Hanukkah presents to buy, or perhaps a Festivus pole to replace. But winter holidays aren’t the only ones that give our wallets a workout.
According to an annual survey by Visa (V), many Americans plan to spend quite a bit to celebrate the Fourth of July. On average, households will lay out $300, a 58 percent increase above last year.
What’s all that money being spent on? Well, burgers and hot dogs to be sure, but nearly 10 percent of the total will go for fireworks. Southerners and Midwesterners spend the most on pyrotechnics — about twice as much as those in the Northeast and West. (The coastal states tend to have greater restrictions on fireworks and more limited access to them.)
Still, households in the Northeast are forecast to spend the most overall, an average $454. Just 12 percent of consumers surveyed plan to spend nothing on the holiday, down considerably from 21 percent last year.
Don’t Let Your Savings Go Up in Smoke
Here’s the problem, though: Many people can’t really afford to spend so much on the holiday.
According to the 2013 Retirement Confidence Survey published by the Employee Benefit Research Institute, the percentage of American workers who have saved for retirement remains at record lows, and among those workers with household incomes of less than $35,000, it has fallen — to 24 percent this year from 49 percent in 2009.
Rein It In but Still Have Fun
Fortunately, all is not lost. You can still have a very enjoyable holiday without breaking the bank or going into debt. Here are some tips — many of which apply to spending for other holidays, too. Perhaps the most important piece of advice comes from Visa’s head of U.S. financial education, Nat Sillin, who says, “the Fourth of July is a great day for celebration, but don’t let your budget explode like a firework. It’s important to plan your spending and then stick to that plan.”
Longtime Motley Fool contributor Selena Maranjian, whom you can follow on Twitter, has no position in any stocks mentioned. The Motley Fool recommends Visa.