Another holiday season is upon us. This time around the buying is robust. Canadian millennials are expected to spend the most at close to $1600. From baby boomers to Gen Z, the average spending is around $1300.
Many people go beyond what their budgets allow when it comes to holiday shopping. The result is maxed-out credit cards and the inability to catch up in the new year, and as a result, some people have a harder time paying their mortgage or utility bills. For some, by the time they catch up the holidays are upon them again.
Don’t let this happen to you. Though the specialists at Cashin Mortgages can help you refinance your home loan to save some money, it won’t help if you don’t have the funds to make normal payments. To avoid this, here are some ways to manage your holiday expenses.
Stick To Your Budget
This is the biggest difficultly not only during the holidays but throughout the year. We humans are simultaneously responsible and impulsive. Though we initially stick to our holiday budgets, there’s that one thing that causes us to throw the plan out the proverbial window. There’s a way to minimize this and stick to your budget. Always include a discretionary fund with enough money to cover purchases that aren’t part of any list. With this method, you have the power to be a bit impulsive without breaking the bank. Furthermore, it allows you to spend something on yourself during the holidays. In addition to the discretionary fund, you also want to create one for everything needed to prepare the gifts. For instance, boxes, gift wrap, bows & ribbons, tape, greeting cards, and expenses related to delivery. It might not seem significant, but these items could cost $100 or over if you provide gifts to multiple people.
Put The Credit Cards Away
Billions of dollars are charged to credit cards during the holiday season. This creates a huge amount of debt for their owners. Not only with the amount they spent but also the interest that’s accrued on remaining balances. In the end, your household budget falls apart. Avoid this situation by not using credit cards when holiday shopping. Instead, use cash to establish a finite situation when it comes to out much you spend. This does more to keep you on budget and not stress out during this time.
Save Throughout The Year
A major problem people encounter during the holidays is they don’t seem to have enough money to spend on gifts. This is especially true if they didn’t save throughout the year for this season. Hence, the reason so many people break their budget or utilize credit cards.
It’s not hard to put money away as soon as December 26th of the previous year. Open a savings account and determine how much you want to put into it each month. If possible, consider directly debiting a portion of your paycheck into this account so the process is transparent.
Shop During the Off-Season
While shopping over the summer you find a bathing suit or sundress that would be perfect for a person on your holiday list. There’s no need to wait and purchase this item during the holidays. First, it most likely isn’t available in the winter. Second, you might forget about it months later.
Make the purchase the moment you see the item. In fact, try to do a good portion of your holiday shopping throughout the year instead of waiting for Black Friday. This spreads the expenses out over a longer period. In turn, it doesn’t feel as painful closer to the end of the year.
Make Your Gifts
Though the stores are still full during the time between Thanksgiving and Christmas, many people spend their time making gifts instead of shopping for them.
The money you spend on materials for items like clothing, crafts, or food has a greater return on investment. It allows you to make multiple items from one source. In other words, the purchase of flour, sugar, and other baking ingredients allows you to create multiple recipes, providing gifts for many people.
Needless to say, your holiday budget should be far less if you decide to make your gifts. However, your sweat equity budget must be increased to compensate for the time needed to finish everything.
Work The Thrift Outlets
You’d be surprised at the amazing items people find at thrift outlets and second-hand stores. You could find tagged clothing from name-brand manufacturers, gently used housewares, and various DVDs, books, and games. Many of these are brand new or in near-mint condition.
Yes, it takes time and a bit of patience to scour these businesses. Yet, the returns could prevent a sizable dent from emerging in your household finances. On top of this, purchasing these items helps reduce waste as they are repurposed for a new owner.
As you see from the items mentioned above there are plenty of ways to manage your holiday expenses. Overall, it relies on your willpower to not purchase everything you see for your friends and family. If they cherish you it won’t matter how many gifts you give them. It’s going to be the thought that counts.
Whatever steps you take to maintain your holiday budget, your Cashin Mortgages agent is here to help guide you through your financial needs before, during and after the holidays.
Finally, from all of us at Cashin Mortgages, we wish you a Happy Christmas and a wonderful New Year.
