How to better manage your finances during the holidays

Holiday spending is predicted to increase this year, with 30% of consumers planning to spend more in 2021 than in 2020.

While an increase in holiday shopping can strengthen the economy, it can also leave deep holes in the pockets of ordinary consumers.

Planning ahead is essential for anyone who wants to stay on top of their finances this holiday season.

If you’re concerned about how this year’s holiday spending will impact your finances, we’ve got your back. In this article, we share six simple ways to manage your holiday finances with purpose and purpose.

Look ahead before making a plan

Looking ahead is crucial to better managing your finances this holiday season.

The holidays place additional financial demands on consumers, causing many to incur credit card debt. This often leads to people turning to credit repair solutions in January to repair the damage.

Before you go on holiday financial plan, think of months like January, February and March. Could your holiday ambitions drain your money in the coming months? Are you going into unnecessary debt to pay for things like gifts or special outings?

Then, grab a pen and paper or a budget calendar and mark your expected beginning and ending balances for the winter months. Include your after-tax income, any monthly credits, and any recurring expenses you have. If you work remotely, don’t forget to consider all options taxes on remote working that may apply to your income during this period.

Then think about what your holiday spending might look like. Include any travel, activities, extra meals, and gifts you want to include in your projected spending analysis. Finally, look for details that indicate you have low cash flow or excess debt based on your projected holiday expenses.

Plan a thoughtful vacation budget

The previous exercise should have given you a clear picture of you financial health during the winter months with your current vacation plans in mind.

If this shows that you have enough money to get through the winter months, congratulations. During the holidays you should not have dry months or excessive debt.

If the exercise has shown that you have used up your cash and/or holiday debt, it is time to reconsider your current plans.

Here are a few quick tips to help you plan a thoughtful vacation budget:

• Build in an extra vacation cushion by rounding up your expected vacation costs
• Open a curveball account to hold you over in case of a holiday emergency
• Open a vacation account with a specific budget and limit your vacation spending to that balance
• Don’t want to open two new accounts? Try the cash envelope system
• Set spending limits for each gift or opt for a Secret Santa gift instead
• Set travel and activity spending limits that fit your vacation budget
• Be honest about activities or gifts you can’t afford and eliminate them from your holiday plans

Consider increasing your investment contributions

While the holidays may seem like the worst time to increase your investment contributions, doing so can help you breathe a little easier.

Upgrade you investment contributions is not only a great way to expand your portfolio. It can also help you be better prepared for the future.

Crypto and NFT are also great investment options, and you can easily track your profits with a crypto profit calculator. Also remember to always comply with your local laws and regulations regarding income and taxes.

If you’re unsure how to contribute to your investments wisely, or you haven’t started investing yet, consider speaking to a financial advisor for support.

Before choosing an advisor, go through plenty of reviews to ensure you hire someone with ethics, integrity, and a lot of knowledge.

Be sure to bring an itemized list of your financial assets, financial objectives and risk tolerance to the meeting. They can also help you choose from the multiple asset protection strategies that you can pursue, ensuring your long-term financial stability.

Get enough sleep

A article from Hims and Hers indicates that sleep deprivation can be costly for many people, as well as for their mental health.

Lack of sleep can increase health risks and lead to expensive medical bills. It can also impact your ability to bring your best self to work, which can lead to longer unpaid time off.

Good sleep also promotes mental clarity, focus and decision-making, all essential for making better financial decisions.

Being mindful when planning your workload during the holidays is crucial to avoid being overwhelmed when you return to work. To ensure you get a good night’s sleep despite any travel, vacation or work plans, it’s crucial that you manage your vacation budget carefully.

Be honest about your holiday budget

It may feel vulnerable to admit that you are limit your holiday expenses this year. But being honest about where you stand financially is crucial to getting on the same page with those you’re spending the holidays with. And chances are some of them are in the same boat as you.

When communicating any spending limits, you don’t have to share specific details if you don’t want to. Keep it simple and solution-oriented.

For example, instead of saying, “I only have $50 to spend on our getaway this weekend,” you could say, “I’ll be there for breakfast, but I have to skip lunch.”

Stretch your budget with affordable vacation activities

Replacing expensive activities with affordable ones is an easy way to stretch your vacation budget without sacrificing the fun.

Here are some ideas for inspiration:

• Instead of going on a ski holiday, attend a lively tree lighting festival
• Instead of going to an expensive restaurant, share a cup of hot chocolate by the fire
• Instead of attending an expensive cooking class, bake Christmas treats together at home
• Instead of going to a comedy club, play group games or group sports
• Instead of going to the movies, start a holiday book club
• Instead of buying gifts at the mall, host a Christmas craft party
• Instead of taking an expensive day trip, plan outdoor activities such as hiking, bird watching or creative scavenger hunts
• Instead of ordering takeout, make s’mores and share holiday stories under the stars

With 30% of consumers planning to spend more on holiday groceries in 2021 than the year before, it’s crucial to keep an eye on your financial health this holiday season.

By following the six tips we shared today, you can take control of your finances and manage your vacation budget.

Are you planning to use any of these tips? Leave a comment below to let us know how it goes.