Did you overspend and overindulge this silly season? Don’t worry we did too! Now we have hit 2021 its time to take back our spending and start to control what we are doing with it again. The average New Zealander spends roughly $645 per Christmas period whether that be gifts, food travel etc. 32% of people use credit cards to pay for this period compared to 58% who will be using a debit card or savings. Unless you are budgeting for this expenditure (which I would recommend) this can be a huge cost to any person come Christmas time. We have put together a few tips and tricks on how we overcome the overspend period to get back on track.
Firstly, its good to know where you are. Take a look at your bank statements, credit card statements and so on, have a look at how much you have in there and how much you are owing. Consider your upcoming bills and expenditure and prepare yourself for those to be coming out shortly. Once you have an idea of where you are sitting (take a break or sit down if its anything like mine!) now we can move on to how to redeem ourselves.
Create a plan to redeem yourself. Now we know where we are sitting let’s take a moment to create a plan. Do not be hard on yourself, the silly season can be costly and now is the time to get back on track! Write down your “budget” or expenses for the upcoming month. Add into this budget any amounts you are owing from this silly season. Note you always need to pay back the monthly minimum amounts with a credit card or hire purchase but if you have the capacity up those amounts in this budget. Make a plan to pay off those pesky debts you have clocked up even faster! (download our budgeting freebie to help you with this)
Try to stop spending in January/February. Once you have your so-called budget in place for the next month, take control by limiting any extra expenditure these next few months. This will allow you to get back on track. Rather than dining out one night, use that money wisely and put it towards paying down that credit card or afterpay amounts.
Start saving for next year now! If you total up how much you spent this year on the silly season, start aiming for that amount in savings now! Total over the next 11 or so months how much you need to put aside each pay. Take this into consideration as you would a normal expense. You will thank yourself come next year having this money handy! It will also help you avoid any debt and clocking up any interest on credit cards, hire purchases etc.
Now you have a plan in place for knowing what expenses are coming out, using that extra spending money to pay down those debts you have clocked up and preparing for the next year. All of these tasks will help you to get back on track with your finances and also avoid the same mistake next year!