It’s Not To Early To Plan Your Spending For Holiday Expenses

by anne on October 18, 2011

Holiday Spending PlansI know, it’s not even Halloween yet. But I can feel the holidays breathing down my neck – and I’ll bet you can too if you think about it for only a moment or two. And the end-of-the year holidays often means the desire and/or need to spend more money than usual.

The key to staying calm and not over-spending for the holidays is creating a holiday spending plan as a way to get control over the money you’ll spend.

A spending plan isn’t a budget – it’s got much more flexibility than that. It helps you set up a realistic plan about spending your money, but leaves you enough room so you can make good decisions on the fly. When you’ve got a realistic plan it’s pretty easy to stick with it.

Start with a list

Think about what you’d like to spend money on for the holidays. Consider gifts, any travel expenses, parties, decorations and the like you’d like to spend money on this year. If you’re part of a household that shares expenses, do this in consultation with the others.

Put dollar amounts on each item. Then add it all up – that’s what you’d like to spend.

If you’re like me you probably want to spend more than you have or at least more than you think you should.

Pick and choose

Start back through your list and eliminate anything that’s simply not affordable this year. If you’d really love a ski vacation for yourself and your partner but you know the cost is out of the question, take it off the list for this year and start saving for next year. Add whatever you can, even $5 a month to your regular spending plan – it’s amazing what setting up a special savings account like this can do.

Now pick and choose what you can do, and how much you want to spend. Play with it until it feels like something that will fit your current financial situation and not leave you in either deprivation or desperation.  And do it all without using your credit cards if you plan properly.

If there’s travel involved or other large expense do some price shopping and see if you can score a bargain – as long as you don’t drive yourself crazy looking.

Make sure your holiday spending plan is in writing. I sometimes actually print a spending plan like this so I can fold it up and carry it with me. That way when I’m tempted to spend extra on one gift, for example, I can look at the plan and decide if I can adjust it or if I need to look for something less expensive.

The goal is to help you be in control of your money, and give you the kind of information you need to make good decisions.

How are you preparing for the year-end holidays?

Anne Wayman




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