As the so-called silly season approaches, many South Africans throw caution and their budget out of the window to enjoy the annual extravagant holiday activities and sprees. Splurging on unnecessary “summer essentials” and gifts or flashy vacations can, however, lead to a financial hangover in January.
Although it’s important to relax and enjoy yourself at the end of a demanding year, this shouldn’t result in unnecessary debt and a compromised lifestyle in 2018. It’s possible to find a balance between enjoying your year-end break and maintaining financial health. The key is to focus on having quality time and meaningful experiences instead of expensive luxuries.
- Set your festive season budget long before December 1 to prepare yourself mentally for the choices you’ll have to make.
- Make a dent in your debt. This will help you to feel confident that you’re in control of your finances as you head into the new year.
- If you are struggling to manage your debt and save, consider partnering with a financial adviser who can help you to build a plan to achieve your financial goals.
- Avoid tapping into credit and stay away from “easy” credit and store cards. Resist the temptation of buying the newest summer fashions, trendy gifts and end-of-year treats on “easy credit terms”.
- If you receive a bonus, use a portion of it – before you have the chance to spend it – to reduce your debt or increase your savings account balance. This “investment” in yourself will improve your financial situation and give you a bit of leeway if you absolutely have to purchase something that is slightly out of your budget.
- Keep a careful track of your expenses. While spending is inevitable, overspending is avoidable, and saving is achievable.
- Stretch your rands by finding marked-down items, sales and holiday specials. Take the time to look for the best deals to suit your budget and try to get your shopping done early to avoid last-minute and unplanned expenses.
Year-end spending should not result in a painfully tight January. Be honest with yourself about your financial position to avoid the burden of debt in the new year. Get a head-start on your 2018 financial goals by consulting a financial adviser and planning ahead so that you have more flexibility to reward yourself and, at the same time, maintain and improve your lifestyle.
Original article: https://www.iol.co.za/personal-finance/how-to-enjoy-december-without-suffering-in-january-12142745