It feels like just the other day that I wrote an article concerning holiday budgets and here we are a year later. It is never too early to start planning for the festive season as before you realise it is the second week of December, the Christmas decorations are up and carols are played in all shopping malls. Unfortunately by then you have missed the planning phase and if you are anything like me, the last place you want to be is in a mall with all the other late Christmas shoppers burning daylight in the ridiculously long queues.
This year I suggest a much different approach by not only planning earlier but also by spending according to your holiday budget instead of relying on your credit card and those high interest bearing personal loans. Try making this year a cash Christmas. Yes, I know this is a long shot, but definitely not impossible with the correct planning strategy.
During January consumers usually flock to debt counsellors due to over-spending during the festive season. Should you be one of the fortunate few who will receive a thirteenth cheque this year, there is no sensible reason for you to spend it all over the holiday season. You have worked very hard to earn it, so spending it all during a three week holiday seems ridiculous when you think about it rationally.
In most instances people are very concerned about their credit rating with the financial institutions and persist to maintain their record of good standing. Avoid ruining this by failing to plan your holiday expenditure and relying on credit which you might end up being unable to afford next year. Also beware of the “buy now pay later” advertisements.
This might seem like a really good idea to get through the Christmas crunch, but I can assure you that it will have no benefit next year. The last thing you want to do is to have a great credit vacation during December and return to reality in January with huge debt. Not only will you start your new year on the back-foot, but you will also soon realise that this is no easy fix.
Consider creating a holiday budget which will include all your expenses from decorations to gifts. Another important part of this budget, which is often neglected, ought to be your outstanding debt. Consider using at least 50% of your bonus to settle high interest bearing debt. This will have an enormous impact on your financial wellbeing in 2015. It only makes sense to rather have an average holiday with limited expenses and enjoy the debt freedom this decision will provide during 2015.
Avoid utilising quick cash solutions such as credit cards or short term loans to make the coming holiday a money-well-spent one. When it comes to gifts, your children really don’t need the latest phone or tablet either. I can assure you they would much rather have a home in which mom and dad are less stressed about money matters. Not only will this improve your lifestyle, but you will be amazed by the health benefit it has in the long run.
There is still enough time to get creative to make your own decorations, and even a few gifts. We find that people appreciate a gift for the whole family, e.g home made biscuits, lovely preserve or luxury treats, more than the ordinary merchandise in the shops!
Christmas is a time for GIVING – small gifts which does not wreck your finances – it is more a time of giving love and time and making memories!