Bulk up your investment/s, avoid overspending.

05/12/2019

Tips to avoid overspending this festive season 

The festive season is in full swing and one thing’s for sure: careless spending will hurt your bank balance. Don’t become victim to holiday stress! We give you tips to help you avoid overspending in this blog.  

  1. Be budget savvy

    Going on a mad shopping spree before the holidays 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 plan 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. Remember to also include payments into your tax free investment account as part of your budget. 
  1. 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.

    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. 
  1. 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, they will saddle you with extra finance charges. Also, having your utilities/ services “cut-off” is never a great way to start the New Year.
  1. 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 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.
  1. Track spending.

    One key component to wise financial stewardship is to track your spending on a daily basis. This is true for life, but it is absolutely essential to avoid overspending during the holiday season. If you have set your budget thoughtfully (Tip #1), it is important to pursue due diligence in sticking to it.

  2. Don’t neglect your investment/s

    Because of the extra shopping during the season, it’s easy to lay off on paying yourself first by saving into your investment accounts. Keep reminders of your goals where you can see them every day. In this way, you’ll keep them in mind whenever you have to make a financial decision. And if you don’t already have investment/s, maybe it’s time to do some research into investment banking and find the best investment options for your budget.

Avoiding overspending during the holiday season may not be easy. It certainly requires extra time and effort. But, trust me, your January will thank you for it.

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