November 20, 2017
With December just around the corner and school summer holidays looming, it helps to be financially prepared.
Rather than getting caught up in the “spend now, worry later” approach, now is the time to plan for Christmas and holiday spending. It may be the silly season but sensible strategies never go astray.
We all know how expenses can add up at this time of year: kids are at home, expecting to be entertained, families often travel to holiday destinations, which means more money spent on petrol, food, and accommodation. And, if it’s your turn to host relatives or friends this year, there’ll be extra mouths to feed, more fun outings to finance, bills to haggle over and more than likely a higher utility bill to cover.
Christmas gifts also need to be bought, cupboards traditionally stocked with snacks, drinks and extra holiday ‘spoils’ and, if that’s not expensive enough for you, there’s also the ‘Back to School’ season to prepare for in January, with all the financial commitments this entails.
If you’re lucky, their might be a surprise work bonus; if not, you may need to put some plans in place to see out the leaner days in January, when life gets back to normal and all the celebrations are over and done with for another year.
The following are a 5 tips for saving money for December and January and surviving the silly season.
- Don’t use your credit card - pay cash
As far as possible, avoid using your credit cards for paying off holiday expenses. Swiping your credit card to pay for luxuries may be tempting, but if you don’t have the means to pay it back in time or any extra savings to fall back on, it may be wise to tuck that card away safely and only use it for regular budget items instead.
- Setting a budget
Drawing up a special and realistic budget for the holiday season is a helpful for saving money over the December/January period. Knowing how much you have, are willing to spend, and on what exactly, can help you stay financially disciplined, especially when the stores and the kids are pulling out all the stops to get you to indulge and ‘buy, buy, buy’!
- Cuts costs and save money now
As you ramp up for the December holidays, consider cutting back on any unnecessary, nice-to-have spending over the next couple of months: eat out less, save your clothes budget for essentials, keep an eye out for specials, and check out holiday sites for discounts on flights and accommodation. If you haven't already, now is a good time to start stocking up on Christmas shopping – especially for gift purchases and buying non-perishable food items.
- Let your home work for you
Homes no longer have to stand empty over the holiday season: new online platforms like Airbnb make it easy to rent properties out to visiting tourists (or locals) who aren’t willing to pay expensive hotel or B&B rates and are happy to forego some finer luxuries to save on holiday accommodation costs. Use the money you earn from letting your home out over the festive season towards paying for your own holiday or save this money for the leaner months in the New Year. Better still, put your earnings into your home loan!
- Don’t neglect your home loan
This brings us to our final tip: as tempting as it might be to cut down on your home loan repayments over the upcoming holiday season, don’t. It’s important to protect your most important assets and not cut corners for short-term gains. Remember that the best gift you can give your family is the roof over their heads and their education. Keep the silly season in perspective and don’t put yourself under unnecessary financial pressure which you may regret later.
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