Huddle publishes commentaries from groups and individuals on important business issues facing the Maritimes. These commentaries do not necessarily reflect the opinion of Huddle.
By Larry Crandall, licensed insolvency trustee, Grant Thornton Limited in New Brunswick and PEI
Christmas is just around the corner, and the temptation to blow budgets and spoil loved ones is high. Although gift giving is a rewarding part of Christmas, holiday excitement often leads to impulse purchases, which creates financial difficulties in the New Year.
As a Licensed Insolvency Trustee with Grant Thornton in New Brunswick and PEI, I provide debt solutions to individuals and businesses in financial difficulty. During my time, I’ve noticed an influx of consumers seeking debt help in January due to overspending during the holiday season.With the average household debt on the rise in New Brunswick, I wanted to share my top five tips to stay on budget and save money this Christmas:
1) Create a realistic budget with some wiggle room
Setting a budget that’s too tight could create frustration and cause you to give up and abandon your financial plan. To prevent this, really think through your budget and look over your numbers to ensure you’re set up for success. Conduct a personal audit to determine your current financial situation and how much money you’re able to allocate to gifts.
2) Cut back on the little things
It makes a big difference. Your daily grande Americano from Starbucks costs $70 a month. Opt for homemade lunches and coffee for the month of December and put that money towards your holiday budget. Make sure to track your cutbacks to have an accurate idea of how much you’re saving.
3) Pare down your gift-buying list
Do a Secret Santa/gift exchange with your family or put a limit on costs. Often, your family and friends are in the same boat and would gladly accept the financial break on their end as well. If you’d like to give individual gifts to certain people, consider baking cookies or making homemade gifts to cut costs. After all, it’s the thought that counts.
4) Remember what the holidays are really about
The holidays are a time to appreciate loved ones – don’t undervalue the gift of your presence. Plan an outing with your family, or suggest a do-it-yourself Christmas lights tour to spend time with your loved ones without breaking the bank.
5) Put your credit cards on ice this winter
If you can avoid using credit cards this season and set aside money or pre-paid visas, you’ll be in better financial shape when the bills start rolling in in the New Year. This will prevent you from making impulse purchases and keep you on track.
Ultimately, the key to staying on budget is to plan ahead and be realistic about your financial situation. Resisting the temptation to go over budget will keep you from going into the red and allow you to enjoy time with friends and family without worrying about financial repercussions.