There’s something about December that makes us throw money around like there’s no tomorrow. It might be fun while it lasts, but January almost never is. This December, do things differently.
Maybe it’s the perfect summer weather. Or not having to be at the office every day. Whatever the reason, it seems to be easier to spend money in December than in any other month. And although traveling to spend time with friends and family, and gifts for those who celebrate Christmas do result in more expenses than usual, it is possible to not break the bank. It’s also necessary because, you know, January, school fees, transport money…
If you want to deal with December differently this year, the starting point always is your budget. The first thing to remember is that you have to budget for a longer period than usual because you are probably getting paid earlier in December than in other months. If this is the case, don’t start spending your December salary before the end of the month. If you do, you could very well be very short before your next payday arrives.
The thing with getting paid early is that it makes you feel quite wealthy – a feeling that tricks you into spending.
To prevent yourself from spending January’s school fees, food budget and transport money in December, find a way to set it aside. You could deposit it in a separate account, or draw the cash and put it somewhere safe (or give it to someone) where you can’t get to it to spend it.
You could even arrange to make early payments where possible. For example, pay school fees in December, and buy your public transport tickets – for trains and buses – in advance.
Remember to leave enough money in your account for your debit orders to be honoured. If not, you will incur unnecessary bank charges, as well as penalty fees on the arrears accounts. Almost worst of all, when you miss payments your credit score suffers. This could have a negative impact on future transactions or activities, such as entering into a lease agreement or opening an account.
Another great tip is to play open cards with your family members. Sit down with your spouse or partner and your children, and discuss the December budget with them. That way everyone knows how much money is available and you can all participate in the decisions on how to spend it. If you then have to say “no” to something, it won’t come as a surprise and will be easy to explain.
Have a similar discussion with your extended family, if needed. Agree on how you are going to approach Christmas lunch, for instance (is it really necessary to prepare all that food, and buy all that booze?), and agree on a budget for gifts.
Finally, remind yourself of the difference between what you want and what you need. It’s always a useful question to ask when you consider a purchase that is not in your budget, and even more so at this time of year when the whole holiday vibe makes it easy to throw caution to the wind.
The holidays are a time to relax and have fun, and you deserve to do that after a long year. But be kind to yourself. Don’t spend so much money in December that January becomes a hardship.