How to avoid a financial hangover this Christmas

The festive season is quickly approaching, which means plenty of generous gift-giving and indulging. It can be easy to fall into the trap of overspending and overindulging during Christmas, which can lead to huge financial setbacks and debt in the New Year. Christmas is meant to be enjoyed and an opportunity to spend time with loved ones, not to suffer from financial stress or pressure. 

How do you avoid the stress of a financial hangover during Christmas? Start your financial planning now with these key tips to avoid overspending and ensure you are starting the New Year with ample savings and a refreshed mindset. 

Set a realistic budget (and stick to it!)

It’s easy to get carried away when buying gifts without keeping track of your expenses and leaving it to the last minute. A key tip is to make a note of any upcoming non-Christmas-related expenses such as bills, food, rent, or important social events and allocate the money needed for these items. Then, curate a list of the people you will be buying gifts for, as well as any money to be spent on food, drinks, etc around Christmas. Using the money left over, allocate how much you ideally want to spend on each individual or item and go from there. 

Having a budget in place makes it easier to keep track of your spending habits and make better decisions, saving you money in the long run. Ensure you continue to track your expenses as you go and stick to the limits of your budget as much as possible to avoid overspending. 

Pay with cash

Try to pay for your expenses with your own money, whether it be cash or a debit card linked to your savings. This way, you won’t fall into a debt trap which will help to avoid the financial hangover in the New Year.

If you find yourself prone to mindlessly tapping your card, leave the card at home and bring cash instead. 

If you do need to pay with a credit card, be sure to pay off the balance in full as quickly as possible into the New Year so that it doesn’t build up and create a huge setback. 

Reduce spending in other areas

Need more money for gifts and socialising during this festive season? Take a look at your budget and try to find the areas you could reduce your spending throughout December. 

It’s also helpful to start putting aside money to use in the Christmas season in your monthly budget as early as possible, that way you may not have to sacrifice other expenses during December. 

Buy now, not later

Avoid any ‘buy now, pay later’ payment options as there is always an eventual financial cost. These services make it easy to accumulate debt, which is the first step to a terrible financial hangover in the New Year.

Spread out your spending

Avoid leaving your Christmas shopping until the last minute at all costs. Instead, stagger your spending in the weeks or months leading up to Christmas to minimise the financial strain.

Planning and starting your Christmas shopping in advance can also save you money when you shop the specials and deals in the weeks leading up to Christmas, such as Black Friday or Cyber Monday sales. 

If you have any questions, don’t hesitate to contact us and discuss with our team here at Maher Group.