It’s that highly-anticipated time of year but along with the fun comes the need for funds.
Rita Cool from Alexander Forbes has some tips on managing your expenses over December and January:
- Create a household budget to see how much money you have to pay for everything you are planning. Start with non-negotiable items like rent or car repayments and factor in the January expenses that need to be paid before you get paid again. Remember school fees that happen in January. Once you have budgeted for these, you can look at your needs and wants.
- If you have non-negotiable items that will have to go on a credit card, work out when and how you will pay off the debt and if it is really worth the expense. You should say no to things which are not in the plan if you can’t afford it.
- If you are entertaining, consider if anyone is staying over and if so, where and for how long? Will they assist with the budget or not? What do you want on the menu for the big events? The budget will show if you need to serve chicken or lamb and if people need to bring their own drinks.
- Check your reward programmes to see if you have cash or credit available to pay for items on your list. Be aware that some rewards points might expire at year-end.
- If you are travelling, have you paid for everything already? Have you factored in the toll road fees, additional treats, activities and eating out?
How do you save on gifts?
- Ask people what they would like so you don’t waste money on something that will not be appreciated. For family, negotiate on bigger gifts by giving jointly for the festive season as well as a birthday.
- Look for discounts on bulk items that can be split and repackaged for individuals. Three for the price of two discounts are common leading up to the festive season. Big bags of sweets or cookies or soaps can be repackaged to become individual gifts in new baskets or glass bottles, also purchased in bulk.
- For teachers’ gifts, ask around and club together to buy a voucher. Teachers love it as they can choose what they want.
- Buy presents during the year on sale.
How can people ensure that sales before Christmas don’t put them into debt?
- Keep your budget in mind.
- Know your prices as a discount is not always a bargain
- Use a list to keep spending in check. Don’t look around aimlessly as you might be tempted to buy something you don’t need.
- Keep the interest on your credit card in mind as the discount might not be as good as you think when you have to buy on credit.
- If you are already in debt, stay away from the shops as much as possible.
Rita Cool is a certified financial planner at Alexander Forbes Financial Planning Consultants.
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