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Surviving the Post-Christmas Financial Hangover

Surviving the Post-Christmas Financial Hangover

It is surprising how quickly the 25th of December can creep up on us. Even though it is the same time every year, it can be easy to succumb to the Christmas spirit and give our finances a bit of a battering. The tips I am about to share not only assist in the few days post-Christmas, but can also be carried over into the New Year to provide a good way to find more money for savings or debt reduction.

Take stock of your situation

This is the scary part! The first step is to face reality, look at the bank balances and see what the damage is. How much did you spend specifically for Christmas? Would you do it again? If so, divide this amount by a weekly/fortnightly amount (depending on your pay cycle) and make it part of a regular savings plan for the New Year. Next Christmas you can enjoy guilt-free spending and no Christmas hangover!

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Tighten the purse strings

One simple way of doing this with little pain is to begin with meal planning. There is a lot of variable spending in our weekly food budget. By taking 10 minutes before you hit to shops to plan what you are going to buy can save you serious $$$. Begin by grabbing a notebook and pen, write each day of the week, go to your pantry, fridge, and freezer and work out what meals you can make from the ingredients you already have. To get inventive, you can Google some recipes for inspiration. Once you are done, you then work out the remaining meals for the week and add these to your shopping list. If you only need 3 carrots, don’t buy a bag that will go to waste. This method is not only good for saving money but also preventing the end-of-week waste.

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End-of-year sales

Unless you have items you need to buy and have budgeted for them, I would suggest staying clear of the end-of-year sales. They are like the pre-Christmas sale period but on steroids! If you have prepared money for this earlier they can also be a good place to buy items at great discounts. But only if you need them. If you are in the latter category, my tip would be to take a list and stick to it (like super glue).

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Think outside the box

There are amazing low-cost ways you can spend your Christmas break. Make a list of things you love to do (or loved doing as a child) and would like to try again. For example, bushwalking, a picnic at the local park, reading a book from the library, going to the beach, playing in the snow (depending on where in the world you are living), making popcorn and watching a movie with the family, catching up with friends for a night in and a game of cards, a day spa at home. Get creative and have some fun!

Another way to live within your means is to cut up the plastic once and for all. If you have debt owing, save $500-$1000 in emergency funds and set up a payment plan to pay off each debt from smallest to largest (making sure you meet minimum payments in the meantime). Once you are empowered to live off your earnings with a savings buffer, you will never need credit (debt) cards again.

Inspiration for the New Year

With the www world available at our doorstep, there are many free ways you can connect for inspiration. Follow a blog, podcast, look around on YouTube, take a free course. If you don’t have access to the internet regularly, check out your local library’s finance section or connect with a friend or family member that seem to have their financial situation together to see if they will share their wisdom. We grow by seeking new ideas, new inspiration and new ways of living. Find your financial guru for the New Year!

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More by this author

Julie Barrow

Freelance writer, financial literacy worker and advocate for lifelong learning

Surviving the Post-Christmas Financial Hangover

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Published on November 20, 2018

The Best Ways to Save Money Even Impulsive Spenders Can Get Behind

The Best Ways to Save Money Even Impulsive Spenders Can Get Behind

The truth is, there are many “money saving guides” online, but most don’t cover the root issue for not saving.

Once I’d discovered a few key factors that allowed me to save 10k in one year, I realized why most articles couldn’t help me. The problem is that even with the right strategies you can still fail to save money. You need to have the right systems in place and the right mindset.

In this guide, I’ll cover the best ways to save money — practical yet powerful steps you can take to start saving more. It won’t be easy but with hard work, I’m confident you’ll be able to save more money–even if you’re an impulsive spender.

Why Your Past Prevents You from Saving Money

Are you constantly thinking about your financial mistakes?

If so, these thoughts are holding you back from saving.

I get it, you wish you could go back in time to avoid your financial downfalls. But dwelling over your past will only rob you from your future. Instead, reflect on your mistakes and ask yourself what lessons you can learn from them.

It wasn’t easy for me to accept that I had accumulated thousands of dollars in credit card debt. Once I did, I started heading in the right direction. Embrace your past failures and use them as an opportunity to set new financial goals.

For example, after accepting that you’re thousands of dollars in debt create a plan to be debt free in a year or two. This way when you’ll be at peace even when you get negative thoughts about your finances. Now you can focus more time on saving and less on your past financial mistakes.

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How to Effortlessly Track Your Spending

Stop manually tracking your spending.

Leverage powerful analytic tools such as Personal Capital and these money management apps to do the work for you. This tool has worked for me and has kept me motivated to why I’m saving in the first place. Once you login to your Personal Capital dashboard, you’re able to view your net worth.

When I’d first signed up with Personal Capital, I had a negative net worth, but this motivated me to save more. With this tool, you can also view your spending patterns, expenses, and how much money you’re saving.

Use your net worth as your north star to saving more. Whenever you experience financial setbacks, view how far you’ve come along. Saving money is only half the battle, being consistent is the other half.

The Truth on Why You Keep Failing

Saving money isn’t sexy. If it was, wouldn’t everyone be doing it?

Some people are natural savers, but most are impulsive spenders. Instead of denying that you’re an impulsive spender, embrace it.

Don’t try to save 60 to 70% of your income if this means you’ll live a miserable life. Saving money isn’t a race but a marathon. You’re saving for retirement and for large purchases.

If you’re currently having a hard time saving, start spending more money on nice things. This may sound counterintuitive but hear me out. Wouldn’t it be better to save $200 each month for 12 months instead of $500 for 3 months?

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Most people run into trouble because they create budgets that set them up for failure. This system won’t work for those who are frugal, but chances are they don’t need help saving. This system is for those who can’t save money and need to be rewarded for their hard work.

Only because you’re buying nice things doesn’t mean that you’ll save less. Here are some rules you should have in place:

  1. Save more than 50% of your available money (after expenses)
  2. Only buy nice things after saving
  3. Automate your savings with automatic bank transfers

These are the same rules that helped me save thousands each year while buying the latest iPhone. Focus only on items that are important to you. Remember, you can afford anything but not everything.

How to Foolproof Yourself out of Debt

Personal finance is a game. On one end, you’re earning money; and on the to other, you’re saving. But what ends up counting in the end isn’t how much you earn but how much you save. Research shows that about 60% of Americans spend more than they save.[1]

So how can you separate yourself from the 60%?

By not accumulating more debt. This way you’ll have more money to save and avoid having more financial obligations. A great way to stop accumulating debt is using cash to pay for all your transactions.

This will be challenging, depending on how reliant you are with your credit card, but it’s worth the effort. Not only will you stop accruing debt, but you’ll also be more conscious with what you buy.

For example, you’ll think twice about purchasing a new $200 headphone despite having the cash to buy them. According to a poll conducted by The CreditCards.com, 5 out of 6 Americans are impulsive spenders.[2]

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Telling yourself that you’ll have the discipline to not buy things won’t cut it. This is equal to having junk food in your fridge while trying to eat healthy–it’s only a matter of time before you slip. By using cash to make your purchases, you’ll spend less and save more.

A Proven Formula to Skyrocket Your Savings

Having proven systems in place to help you save more is important, but they’re not the best way to save money.

You can search for dozens of ways to save money, but there’ll always be a limit. Instead of spending the majority of your effort saving, look for ways to increase your income. The truth is that once you have the right systems in place, saving is easy.

What’s challenging is earning more money. There are many routes you can take to achieve this. For example, you can work long and hard at your current job to earn a raise. But there’s one problem–you’re depending on someone else to give you a raise.

Your company will have to have the budget, and you’ll have to know how to toot your own horn to get this raise. This isn’t to say that earning a raise is impossible, but things are better when you’re in control right? That’s why building a side-hustle is the best way to increase your income.

Think of your side-hustle as a part-time job doing something you enjoy. You can sell items on eBay for a profit, or design websites for small businesses. Building a side-hustle will be on the hardest things you’ll do, be too stubborn to quit.

During the early stages, you won’t be making money and that’s okay. Since you already have a source of income, you won’t be dependent on your side-hustle to pay for your expenses. Depending on how much time you invest in your side-hustle, it can one day replace your current income.

Whatever route you take, focus more on earning and save as much as possible. You have more control than you give yourself credit for.

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Transform Yourself into a Saving Money Machine

Saving money isn’t complicated but it’s one of the hardest things you’ll do.

By learning from your mistakes and rewarding yourself after saving you’ll save more. What would you do with an extra $200 or $500 each month? To some, this is life-changing money that can improve the quality of their lives.

The truth is saving money is an art. Save too much and you’ll quit, but save too little and you’ll pay for the consequences in the future. Saving money takes effort and having the right systems in place.

Imagine if you’d started saving an extra $100 this next month? Or, saved $20K in one year? Although it’s hard to imagine, this can be your reality if you follow the principles covered in this guide.

Take a moment to brainstorm which goals you’d be able to reach if you had extra money each month. Use these goals as motivation to help you stay on track on your journey to saving more. If I was able to save thousands of dollars with little guidance, imagine what you’ll be able to do.

What are you waiting for? Go and start saving money, the sky is your limit.

Featured photo credit: rawpixel via unsplash.com

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