5 Ways to Avoid Overspending this Festive Season

Gift-giving, work functions, school prize-giving, friend’s wedding, holiday plans, renovating the holiday home, joining a gym, the Christmas list goes on and on. The festive season is well and truly upon us. Now, while we make the conscientious effort to (try) avoid over-indulgence at the Christmas dinner table, we do have a habit of filling the plate so to speak when it comes to our silly season schedule, with expenses certainly not exempt. The consequence being an overdraft that is bursting at the seams… as well as your waistline.

With the imminent weight of the silly season bearing down on us all we look at 5 ways you can avoid overindulging, sorry, over-spending this festive season.

 

1. Budget; a tried & true formula like Christmas Turkey

There’s no way we could compile a list like this without the concept of a budget. We’ve heard it before, and we will continue to be reinforced with the idea. As the sub-heading suggests, it is a tried and true formula intended for success. Imagine a Christmas tree without decorations. Or, even Christmas without Santa Claus! We are talking big picture, and if you don’t have a budget in place, make one. And stick to it! It doesn’t have to be complicated, we are not re-inventing the wheel here. Essentially, we need to find out how much money we have now, in relation to upcoming earnings versus expenses. Firstly, assess and take note of your current situation; if you are paid via salary or a fixed hourly wage, simply record your monthly income (perhaps breakdown to weekly increments). Then do the same with your fixed expenses (rent, utilities, student loan repayments, car costs etc). Finally do the same with all other expected expenses e.g. food, clothing. Make sure your costs are realistic, there’s no way we can cut our weekly grocery bill from $150, down to $50 unless you’re not planning on making it through the festive season!

2. Goal-Setting; failing to plan = planning to fail = a ruined Turkey

We can’t have the concept of a budget without some form of advisory goal-setting to complement the action. You don’t simply throw the turkey in the oven, fan bake it at 180 degrees and anticipate a top-notch feast to result. Christmas dinner, as most mothers out there would attest, should be thoroughly planned, well in advance, just like our approach to finances. With a limited timeframe let’s map out and outline some attainable, time-sensitive goals. Short-term let’s make a weekly target. Ensure this is a quantifiable goal. Concerning expenses, this may be as simple as reducing grocery expenses by 10-15%. Longer term the recommendation would be for a monthly target, perhaps to have paid for all the kids Christmas presents by the end of November? Not possible, try eliminating all the car expenses; new WOF and set of tyres by the end of the month. Further down the road, after the silly season when we are all in recovery mode the goal may be to have a plan of attack to repay all the expenses incurred throughout the holiday season. This task will be that much easier and far less daunting if we stick to our budget prescribed in the first tip.

3. Needs versus Wants aka Pavlova versus Turkey

You wouldn’t have Mum’s extraordinary pavlova before tucking into the dry Christmas turkey would you? Of course not, you’d save the best for last! The same goes for your finances; you want to identify and pay all the boring, yet necessary fixed costs first before splashing out on the fun stuff. Think, we need to pay the mortgage or rent, power, car rego first before looking at idyllic holiday retreats to Rarotonga. As simple as this sounds the message is to take caution with expenses over the coming weeks. With only 7 weeks till Christmas, identify what expenses are going to be classified as ‘essential’. Factor these into your budget now, along with automatic payments before figuring how much you will have remaining to freely spend on stuff like that new swimsuit for Raro.

4. Experiences Matter; Holiday versus Christmas Sweater

Do you recall what you did for Christmas 3 years ago? 6,7 years ago? Chances are there may be the odd memory that sticks out, and guaranteed, the memories that last aren’t related to that shocking Christmas sweater your Aunt made for you. The point is, the festive seasons that stand above the rest are those where the experience trumped the stuff we received as gifts. And experiences don’t have to be extravagant travel plans that cost a fortune. Think fun, first and foremost and then perhaps cost-effective means to enjoy the holiday season. A day at the beach, camping, read a book, go completely off the grid by avoiding screens (cell phones, iPads & tv’s) for a week. Now that’s a challenge!
And if you’re looking at booking an extravagant holiday for the next festive season read on. We can make this happen, if planning begins now.

5. Take advantage of Christmas Saver Accounts (SAVE!)

We all know Christmas and the festive season is an expensive time of the year. We all see it coming, yet many of us do not correct the mistakes we have made in the past. The costs add up and with it the stress levels. To avoid overspending, a final recommendation would be to take advantage of Christmas Club’s and Christmas Saver accounts. Wouldn’t it be a pleasant bonus to be stress-free throughout the festive season with the peace of mind to engage in whatever activities you like, regardless of cost. If you’re not already taking advantage of such offers, make this a goal for next year so we do not encounter the same problems in the build-up to the festive season.

Did you know NZCU South have a Christmas Saver account? Designed specifically for your family to enjoy the special things at Christmas time.

 

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