The festive season is in full swing and one thing’s for sure: If you’re not careful to apply basic financial literacy, your bank balance might take strain. Don’t let yours become a victim to holiday stress! Our Financial Advisors offer valuable financial to help you avoid common financial mistakes this festive season.
- Be budget savvy
Going on a mad shopping spree before the holiday’s means you’re likely to come up short in the New Year. While we all want to spoil our loved ones, you might end up paying for it in more ways than one.
Before you get started on your gift list, set yourself a personal financial budget. If you know how much you have to spend per gift, you can resist the temptation to spend too much. Shop around and you will find great gifts that will suit your pocket. The trick is to do your research. You could also consider making your presents.
- Dip into credit with caution
Your credit card can be your best friend, or your worst enemy… often, both at the same time! Just because the funds are available to you, doesn’t mean you have to deplete your credit allowance in one go. Remember, come January, there will be a whole lot of new expenses (like new work clothes, back to school/ college items). It’s important to keep all of these in mind.
If you’re ready to apply for an African Bank credit card, click here to apply in minutes.
The same goes for credit on your store cards. The best advice is to avoid spending on store cards – often the interest rate is very high – but if you can’t avoid it, be wise with your purchases.
- Bills, bills, bills
When you’re hyped up on holiday spirit, it’s easy to forget that your December salary has to last you until the end of January. So, before you start funding all those festivities, it’s essential that you plan ahead. If you know you have debit orders coming off your bank account on the 1st of every month, make sure you leave enough money in your account to pay those bills. Bounced debit orders are not only bad for your credit score, but will saddle you with extra finance charges. Also, having your utilities/ services “cut-off” is never a great way to start the New Year.
- Resist the urge to splurge
Buying fabulous gifts for every member of your family can be a huge financial strain. A smart way around this is to play Secret Santa.
This is how it works: Set a budget and let everyone know to bring ONE gift at a set value. Let’s say you have 10 people, then you’ll have 10 gifts. This means each person has to buy only one gift and will take home a gift, too.
There are many ways to play Secret Santa. The most fun however is by letting each person draw a number out of a hat. Whoever draws No1 starts the game and selects a gift. From the second person onwards, participants take turns either selecting a gift or “stealing” one of the already opened gifts from other participants. The last player is the luckiest – he or she ends up with the best present of the bunch. Click here for different ways to play Secret Santa.
Buying one gift as opposed to 10 relieves holiday stress, both financially and in terms of how much time you spend shopping.
- Lucky number 13
If you’re blessed enough to earn a 13th cheque this December, remember to use it wisely! Instead of mindlessly blowing your cash, think of how you can put it to good use instead.