As the year winds down, the holiday season comes into full swing. It’s easy to go overboard with gift buying and holiday activities and forget about the financial consequences of extra spending. This holiday season, sit down, create a plan and track expenses to ring in the new year without debt or a depleted bank account.
Here are six smart tips to manage holiday finances:
1. Set a Limit
Before creating a holiday budget, look at current spending habits. Any extra money after fixed costs are paid off can be used for holiday spending or added to savings.
2. Create a Budget
Holiday shopping doesn’t only include gift buying. Factor in spending on decorations, food, travel and more. Set realistic parameters when creating a budget, and allot a little extra money for unexpected or last-minute shopping items.
3. Prioritize Spending
Not everything on a holiday list is necessary. A present for a grandchild might be a must-have, while new holiday lights would be nice, but are not necessary this year. A holiday shopping list should be prioritized from musts to wants.
4. Look for Discounts
There are many stores that offer deals and special sales. Join email lists or sales text alerts from favorite stores to help with budgeting.
5. Track Purchases
Cross items off the shopping list immediately after purchasing. By tracking spending right away, it becomes easier to stay within a budget, and serves as a reminder of outstanding items to be purchased.
6. Use Cash
By using cash, it’s easier to comprehend how much money is being spent. Withdraw the total holiday budget, divide the cash into envelopes based on categories, and use the cash only for that spending category.
For more tips on financial planning, contact Alexander and Associates for a FREE consultation! Alexander and Associates offers clients estate planning and over 20 years of experience in wealth building, estate planning and administration, probate business and litigation.