Managing Holiday Spending

 

Not everyone celebrates Christmas or indulges in serious gift giving, but most Canadians enjoy time off work and spending extra time with family. The kids are out of school for two weeks, so it's an excellent time to travel to visit relatives or take a family vacation. No matter if you're celebrating a religious holiday or just enjoying a break from work, these tips should help you get through with your budget somewhat intact!

Of course, the most practical tip is to save year round for annual expenses such as Christmas gift giving and annual vacations. Most financial institutions have automatic transfer programs where you can have a fixed amount per pay period set aside in a special savings account. That way, you're not tempted to 'forget' to transfer the money yourself.

First, take a look at your monthly budget and see how much you can realistically afford to set aside each month. Next, make a list of the holiday expenses you'd like to spend and add them up. Take the total and divide it by twelve. Compare that amount with the amount you determined you could afford from your monthly household budget. Can you afford to set aside that much? If not, go over the list and prioritize the items, cut back on the individual amounts you'd like to spend, or remove items you can do without. It's not too late to start now - anything you save between now and Christmas will help.

On the other hand - it may be too late for most of us! Suddenly we realize we don't have a thing saved for gift giving, traveling, or indulging ourselves in feasting and merriment, and our budget is so tight, we can't imagine how we'll come up with the funds. That's when it's time for hard decisions. You may have to reduce the number of gifts you buy, decide to sell any unused items you have around the house, opt to make gifts, cancel plans to travel or scale down entertainment plans. Be creative. Some families have a 'lottery' type gift giving system, where each family member buys for one family member only. Rather than buying several small gifts for everyone, you can spend less by shopping for a more expensive gift for that one person. How about giving a mechanically impaired relative free oil changes for a year, or give free babysitting one night a month for a year for the new parents on your list. Why not organize a pot-luck open house rather than footing the bill yourself? Progressive parties were all the rage in some neighbourhoods last year - kind of pot-luck in reverse! Each household makes a dish, and the neighbours move from house to house every hour, tasting a different gastronomic delight at each home.

Above all, resist the temptation to use credit cards. Credit cards lead to overspending, and impulse shopping. Most people do not know the exact balance owing on their credit card - they just keep charging until they reach their credit limit. Save your credit cards for genuine emergencies, and find less expensive ways to celebrate the holidays. Most relatives and true friends would feel extremely uncomfortable accepting a gift from you if they knew it put you into financial difficulty. And if you talk to them openly about it, you may be surprised to find their budget is as tight as your own. They may actually be relieved that someone has finally decided to pull the plug on Christmas overspending. After all, the important thing about the holidays is not who can spend the most money, but spending time with family and friends, enjoying each other's company, and celebrating your seasonal religious beliefs.

If you need help setting up a household budget to start saving now, call your local SISIP Financial Counsellor. You don't need to be experiencing financial difficulties to access our services. If you'd just like one meeting to get yourself on track; if you'd like to meet with a Counsellor on a monthly basis to set a budget and stick to it; or you're at your wit's end and don't know how to get yourself out of severe financial problems, call us. We'll discuss thoroughly your financial situation and give you free and confidential guidance.

 

Past Articles