How To Improve Your Finances For The Upcoming Holidays

How To Improve Your Finances For The Upcoming HolidaysThe holiday season is fast approaching and you need to improve your finances before it completely falls upon you. September is only a day or so away and that signals the start of everything that is joyous, festive, and, if we may add, expensive.

Now spending your hard earned money is not really bad. After all, that is why you work as hard as you do to earn them. You want to enjoy your life. You want to be able to afford to pay for the festivities that will make the holidays all the more special.

However, finding yourself in need of financial recovery after the holidays is not really the best way to end such a joyous occasion. This is why it is important for you to prepare your finances so you do not end up with holiday debt.

The truth is, a lot of people end up in some form of debt after the holidays. The festivities make them loosen any restriction that they have on their budget. It seems that this is the perfect time to be carefree with your expenses – especially when you know that it will make everyone feel happy. After all, buying gifts to give to your loved ones is an act of your love for them. You want to be generous with them because that is what they deserve.

According to statistics, consumers added $1,003 worth of debt after the 2016 holidays. This was higher than the average holiday debt of $986 after the 2015 holidays.

If you really want to prolong the happiness that you felt during the holidays, you may want to make sure the festivities will not land you in debt. Fortunately for you, that is possible if you improve your finances before the holidays arrive.

Steps to prepare your finances for the holiday spending

There are a couple of steps that you need to go through if you want to prepare your finances so it is ready to take on the many expenses that you will spend during the holidays.

Make a list of your holiday expenses.

Start by making a list of what you expect to spend this holiday. Since this is an annual thing, you should have an idea what to expect. Think about what you spent in the past few holidays. You need to spend on gifts. You also have to spend on the food that you have to eat. If you have to attend parties, you need to spend on your dress and clothing. Of course, you also want to decorate your home to make it festive. These are only some of the things that you need to spend on. You have to make a list to identify what they are. There may even be changes from what you spent in the past. If you went on a vacation the previous year and you have no intentions of going this year, that would be one less expense for this year. Or the opposite can be true. Make a list of your holiday expenses so you have an idea what you are up against.

Set a holiday budget.

Once you know what you will spend on, it is time to set a budget. Do not look at the expenses and give them a budget immediately. You need to study your finances first before you assign a budget. Make sure the upcoming holiday spending will not compromise the priority expenses. Do not worry if it appears like you do not have enough. If you start early, there is still time to save up for it. According to statistics, the average holiday spending is currently $419. It is only September. If you put aside $150 each month, you will have $450 by the end of November. You need to make sure you allocate this fund properly. Look at all the expenses that you plan to make and set a specific amount that will limit how much you will spend on it.

Save up for your budget.

After allocating a budget, it is now time to save. The amount that you will save each month will depend on how much you intend to spend. If you will follow the statistics, you need to save $150 each month starting September. If you need less, then you can put aside a smaller amount. In case you need more, then you just have to work harder to improve your finances to save more.

Of course, there are two ways for you to approach this saving goal. One is to spend less. You can opt to stop spending for some of the unnecessary expenses that you have. The other option is to simply earn more. You can opt to declutter your home and sell what you do not need. You can use the profit to pay for what you need for the holidays.

Do your research.

While you are saving for your holiday fund, it is important for you to do your research. Know when your favorite stores will go on sale. That way, you can be ready to make a purchase – especially when it comes to the gifts. The gift-buying can be done beforehand. Make a list of the people that will wish to give a gift to. When there is an opportunity to buy something for them that is on sale, grab it. Use the money that you have been saving. Make sure that you are aware of the budget that you have for each person so you will not be in danger of overspending.

Know your credit card rewards

It is okay to use your credit card to buy the things that you need for the holidays. You can take advantage of the credit card rewards on it. If you will use it anyway, you should make sure that you can get as many points or rewards as you do. Of course, you have to make sure that what you will spend on it will be paid in full once the billing statement arrives.

If you follow all of these steps, you should be able to improve your finances in time for the holiday season. You can rest assured that you will not land in debt right after the holiday festivities.

How to keep your holiday spending manageable

Preparing for the holiday spending can lower the risk of being in debt – but it will not guarantee it. You still have to continue making the right decisions about how you spend your holiday fund.

Here are some tips that you can follow so you can spend your money wisely.

Start shopping early

The earlier you start, the more chances for you to save money. According to statistics, online shopping is a rising option among holiday shoppers. This is expected to persist until 2017. That means you can expect a lot of good deals online. You may want to start doing your research so you can find the best deals. Since you are having the gifts shipped, you need enough time for the gift to be delivered.

Recycle what you can

Instead of spending money, you can also choose to recycle. Reuse the old decorations that gave your home the holiday feel in the past couple of years. You can also see which of the gifts you received in the past can be given to someone else. Just make sure you do not give it to the one who gave it to you in the first place. It is also okay to do your own gifts. That should help you save a lot of money.

Use cash for purchases

There are pros and cons for using cash to buy something. It is true that your money is more in danger of theft. However, you can also limit your spending. With credit cards, the temptation to go beyond your budget is strong. When you only have cash with you, you do not have to worry about spending more than what you should.

Learn to say NO

Finally, you have to learn how to say NO. When you know that a certain gift is beyond your budget, you need to control yourself and say no to that expense. The same is true for parties or other events that might make you spend more than what you should. Unless you can revise your budget, try not to accept changes in your holiday plans. When it comes to saying NO, that should also include you. You deserve the reward – that is true. But make sure you are not robbing your future self of a good time by making yourself pay for the debts of your past.