As the year is about to end, you could start to be afraid of holiday expenses because you know that it will be a very expensive time of the year. It actually is because of all the traditions people have been observing over the past few centuries. There is gift-giving, social events, and even the desire to be with family on this special occasion.
All these require you to spend a considerable amount of money to get through the holidays. When you start purchasing gifts for people around you, it can run up your credit card balance. Even booking flights to go home to the family can be quite an expensive venture. Not to mention attending or even hosting parties over the holidays can add to your stress level.
These are some of the reasons why you could be afraid of holiday expenses. It can even overshadow the true meaning of holiday since your finances normally take a hit. You could start to think of ways to avoid the holidays altogether. It can be going out to a place where no one knows and you wait everything out and come back once the season is over.
Should you really be afraid of holiday expenses?
The short answer to it is no, you should not be afraid of expenses over the holidays or for any occasion for that matter. You need to understand that expenses are a part of life and it is deeply ingrained in society and in the way we live. Take a look at your basic expenses and you will understand that from food to clothes to the house you live in, you have to spend money.
However, you still have to watch how you spend your money even if it is part of life already. The key is being able to balance your income and expenses in a way that brings you closer to your goals. You need to stay on top of your expenses and understand why you do what you do.
Stay on top of your expenses
You do not need to be afraid of holiday expenses but you have to stay in control when it comes to your expenses. In fact, CNN even shared that American shoppers are banking on a strong economy as they regained spending confidence. Here are a few questions you need to ask yourself when it comes to your finances.
Why are you spending too much?
This is the first question you need to ask yourself and the answer could take time to reveal itself. It is easy to figure out how much you spend and where you spend it for but why you do it is a different question. You need to start looking within yourself and have a self-assessment on why you manage your finances the way you do.
Were you deprived of growing up and you never got to afford all the things you want? This could be a reason why you keep spending more than what you can afford. You are trying to make up for the lost time by buying all the things you were never able to afford growing up. This can be a reason why you spend the way you do.
Why can’t you control your spending?
One of the reasons why you could be afraid of holiday expenses is that you know that you cannot control your spending. You are at a point where you cannot pull yourself out of purchases you know you will regret later on. It is imperative that you be aware of these situations and be mature enough to walk away from it.
Apart from that, you need to understand why you are unable to control your actions. There are times when you really are an impulsive shopper and a sale sign makes you all excited and giddy to spend right away. In severe cases, you might need professional help to pinpoint the cause and find a way to address it before it ruins your finances.
What can you do?
Now that you have an idea of why you are afraid of holiday expenses, there are a few things you can do to help you get ahead of that fear. Here are some of them worth exploring.
Start saving for planned expenses
If you know that the holidays will be quite expensive, it is a good idea to save up for it. This lowers the need to take out credit or be in debt because of it. Much like how you save up for planned expenses, the holidays should not be any different. You know when it will be and the possible expenses you will incur from it. This gives you the chance to estimate how much you will need for it.
One thing you can do is take out the expenses you had last year and prepare the same amount. It would be great if you can put together a separate budget for this year as well. This will show you how much you need and what your expenses will be. It will make monitoring easier and help you plan for next year’s expenses better.
Build up your emergency fund
You need to make sure that you are consistent with your emergency fund savings because the holidays are no exception. In fact, getting into an emergency during the holidays can make it a little more challenging to get through. One one end, you have a lot of expenses during the season and on another, you are already deep in debt
If you can build up your emergency fund, it can help you get through these difficult times. It can be anything from a broken appliance at home or even finding out that you were let go at work. Having some reserve funds will help you manage your finances through the holidays without getting into more debt.
Move forward with your savings
Fear can be crippling and one of the best ways forward is to stick to what you need to do. If you have a goal to retire in your 50’s, stick to that plan and move forward with this target instead. It helps keep you motivated and focused on the more important things in your life. Holidays will come and go but you just have to stick to your goals.
Create income-generating activities
It might be the last thing on your mind but rather than be afraid of the costs during the holidays, it might be a good idea to try and look for ways to earn rather than spend. The holidays could be a good time to get started with an income-positive hobby. People are more open to spending during the holidays, especially if it is to support a family member or friend.
If you love to bake, sell your creations to family and friends and package it in a way that it can be re-gifted for the holidays. There will be a number of social occasions as well and your love for photography can be a great way to earn extra funds. The bottom line is to look for areas you are passionate about and then figure out a way to earn extra money from it.
You could be afraid of holiday expenses because you know it can ruin the season and put you in a challenging spot at the start of a new year. The idea is to prepare for it and maybe change your outlook from spending to earning extra money during the holidays.