I aim to write a series of topics that are crucial to consider as we approach the ‘Silly season’. This is episode 1 of 8 more to follow. This is on our bank balance and wallets. Our financial management over the holiday season.
The festive season is a time of joy, celebrations, and spending. However, it can also be a challenging time for financial management. In this episode I aim to provide advisory insights on financial management during the festive season, with the goal of ensuring individuals make informed decisions that align with their financial goals and long-term stability. This season also brings with it stress based on finances. Here is a blue-print to help you maneuver this season financially.
1. Setting a Budget:
One key aspect of effective financial management during the festive season is setting a budget. Create a comprehensive budget that includes all necessary expenses, such as gifts, decorations, travel, and food. Setting a limit on each category will help you prioritize your spending and avoid overspending. Write it down. Discuss it with your family so everyone is on board and you have buy-in. Working as a unit when it comes to budgeting eliminates any surprises later on. Trust and transparency are key to having a really festive season as a family. Deal with the expectations early.
2. Prioritizing Essential Expenses:
While the festive season can be filled with tempting offers and deals, it is crucial to prioritize essential expenses. Focus on meeting your immediate needs, such as bills, rent, and other financial obligations, before allocating funds for discretionary spending. It’s important to strike a balance between celebrating the festivities and maintaining financial stability. Don’t travel if you don’t have to. Use technology to talk to friends and family. Stay safe at home as the roads will be busy. If you have to, plan your trip carefully and ensure your car is in good working condition. Take your car for a 360 mechanical check at the beginning of December. Avoid unexpected expenses or breakdowns during the holidays or when you are on the road.
3. Gift-Giving Strategies:
Gift-giving is a common aspect of the festive season. However, it is essential to find cost-effective ways to give meaningful gifts without breaking the bank. Consider alternatives such as homemade gifts, secret Santa arrangements, or setting spending limits with friends and family to ensure that everyone can enjoy the exchange of gifts within their means. We will also touch on this later when talking about traditions. Are gifts really necessary on Christmas day, or can you wait for the 27th December to get the same or similar item at a fraction of the price when clearances begin?
4. Utilizing Discounts and Sales:
Take advantage of discounts, sales, and promotional offers during the festive season. Plan your shopping in advance, compare prices across different stores, and be mindful of any additional costs such as shipping fees when buying online or hidden charges. Utilizing discounts and sales can help you make the most of your budget while still enjoying the festive shopping experience. Buying after Christmas is also a great way to save as most products will be on discount. Teach your children about ‘delayed gratification’. Save now and get more gifts later.
5. Avoiding Impulsive Buying:
During the festive season, it can be easy to succumb to impulsive buying. To prevent this, carefully consider each purchase and only buy what is necessary or meaningful. Learn the difference between WANTS and NEEDS. Take your time to research products, read reviews, and compare prices before making a purchase. By avoiding impulsive buying, you can prevent unnecessary financial strain. Prioritize your buying. Ask yourself. “Will this product or clothing still be useful in January?”
6. Tracking Expenses:
Effective financial management requires tracking your expenses. During the festive season, it’s essential to monitor your spending closely to stay within your budget. Use mobile apps, spreadsheets, or online tools to track your expenses and identify any areas where you may need to cut back or adjust your spending. Always remember that January is a long month. School fees, groceries, rent, utilities, petrol and transportation still need to be paid.
7. Rethinking Traditions:
Festive traditions often involve expenses such as elaborate decorations, lavish meals, or extravagant parties. Consider reevaluating these traditions and finding creative yet cost-effective alternatives. For example, hosting a hearty yet simple dinner instead of preparing a lavish feast or organizing a DIY decoration workshop with loved ones can be enjoyable while minimizing expenses. Never compare yourself with the Dlamini’s or Molapo’s. Stay in your lane and live your life according to your own pocket. You never know what really goes on in other families behind closed doors. Never spend money you don’t have, to buy things you don’t need, to impress people you don’t like. Or who may not like you.
8. Avoid Debt:
One of the most important aspects of financial management during the festive season is avoiding unnecessary debt. Use your budget as a guide and resist the temptation to rely on credit cards or loans to fund your festivities. Stay mindful of your financial limits and remember that the joy of the season shouldn’t come at the expense of long-term financial stability.
Managing finances during the festive season is crucial for maintaining financial stability and long-term well-being. By setting a budget, prioritizing essential expenses, utilizing discounts, and avoiding impulsive buying, individuals can strike a balance between enjoying the festivities and maintaining control over their finances. With careful planning and mindful spending, the festive season can be a joyful and financially sustainable time. Enjoy responsibly. Avoid spender’s guilt. There are many more holidays during the year to make up for or divide the festivities throughout the year. There is always Easter coming up, birthdays, anniversaries, other parties and those curve balls that life will always throw at you throughout the year. Have a great ending to 2023 and welcome 2024 financially stable.
BY ABUBACAR JÀBBIE