The holiday season is in full swing--family begins to arrive, gift wrap covers the floor, and the oven seemingly won’t recover from all the work it has been doing. This time of year is busy for many people. With the swirl of the holiday itinerary, money seems to be left on the back burner for the new year. By that time, it is often too late to recover from the tiring workout you have put your finances through this season.
Cultivating healthy saving and spending habits takes time and attention that lasts the whole year through. I’d like to show you some ways that you can save more consistently so as not to break the bank each year in December.
Before you can make a budget that really works, you need to be aware of how much you are spending per month. With a traditional budget, you will account for your living expenses (rent/mortgage, food, utilities, insurance, etc.). Right now, I want you to look at the extra things you spend money on.
You might be surprised to realize the amount of money you spend on recreational things. Once you have looked at the way you spend your extra money, you can start to think about ways of eliminating some of those costs. Take it easy on the clothing subscription boxes, pick one or two streaming networks, not 5, and save money by going to the grocery store instead of eating out.
You can put this extra money into a savings account that can be used to accommodate the increased spending throughout the holidays.
The holiday season sees a spike in spending. This is something that many people experience no matter how hard they try to avoid it. By understanding that your costs may increase November through December, you can start thinking about your spending habits long term. Spending is always on a continuum, it changes depending on the circumstances. Now is the time to start planning for the ebbs and flows of spending.
You probably don’t hear many people tell you to plan for more spending. But this is a way to help encourage long-term saving and intentional spending. By eliminating costs you don't need (see above) and putting that money in your savings, you are giving your account the cushion that it needs when spending requirements rise.
Budgets are not just for the holidays! Think about your holiday spending in a relationship with your regular spending habits. Try and incorporate these spending habits into one budget. This practice encourages planning, saving, and working toward long-term goals. Budgets are not always easy to make, here are some ways you can start!
Holiday spending is just one piece of the pie. If you think of your spending holistically, you will be better able to spend according to your budget and values.
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"Finance Made Simple" blog posts are intended for educational purposes and not for specific advice. Each person’s situation is different. Consult your financial advisor for advice relating to topics discussed.