By Tokiso TKay Nthebe
For many trailblazers, the festive season is notorious for going over budget and overspending. With many already on leave until January, this time is also fertile ground for making bad financial decisions, especially if you do not have a financial plan. With Christmas and New Year’s Eve only a few days away, what can you do to avoid the financial trap, navigate the money adventure and survive the ‘Jan-U-Worry’ financial hangover?
This blog post shares practical and money-savvy tips to help you plan and make smart money decisions.
First things first, are you honest about your current financial situation?
Be honest with yourself.
Before we can even start talking about planning how to spend, the first step is to be honest with yourself and take stock of where you are. Sadly, too many people avoid confronting their financial situations and often end up spending mindlessly. They do not take time to calculate how much money they currently have, which often leads to many problems later.
I often encourage my clients to have a holistic view of where they are financially and ask themselves a few questions such as.
What commitments do I have?
Realistically, can I afford to spend during the holidays?
Can I comfortably afford to settle all the bills this month?
Can I afford to cover all my January expenses?
Will my money carry me until the next payday?
If you cannot honestly and confidently answer these questions, perhaps spending time reviewing where you are, is not a bad idea before you start spending.
Plan your spending.
What I love the most about the holiday season is family time. This season for many households means spending time together, celebrating over good food and creating memories. I often write about planning your spending and tracking expenses. The likelihood of overspending during the holidays is extremely high. It is important to prepare a comprehensive spending plan to help you track expenses and manage your finances. Remember, planning your spending does not mean being frugal or boring. It means being on top of your finances and being money-savvy while having fun. Download a spending plan template below.
Take care of the January expenses.
I am sure the monotony of the advice to ‘plan for January expenses’ bores you by now. However, I will continue to reiterate and advise you to plan and take care of the January expenses. Unless you have additional income i.e. 13th cheque or bonus, your December salary should also take care of all the expenses due in January which include groceries, utilities, school fees and other debit orders. A money hack to consider is to put money aside to take care of these expenses or to pay for them in advance.
Set financial boundaries.
In a recent article entitled ‘You are allowed to say No!’ I highlighted the pressure many people experience during the festive season. There is pressure from family and friends to keep up, go out regularly or spend a lot which if unmanaged can lead to poor financial decisions. I cannot emphasize the ability to set financial boundaries, to say no to situations that are not good for you and to help from a healthy place. If setting boundaries is hard, I encourage you to watch an episode on My Money Adventures podcast where I had a chat with Mpheng Ayat Thamae, a counselling psychologist.
Watch the episode here https://www.youtube.com/watch?v=sco0hvwEItA
Have fun, responsibly.
Finally, the festive season is a time to let our hair down and celebrate the milestones and goals achieved. While planning and saving are important, you should not forget to enjoy your money and have fun, responsibly. Life is too short not to have fun and enjoy the rewards of your labour. So, allow yourself to splurge a little and treat yourself.
As you navigate the money adventure this holiday season, remember to be kind and to give to those less privileged.
Disclaimer: This article is not financial advice, please consult a financial adviser for financial advice.