How to get the best out of your festive spending

Although you might have to watch your spending during December, there are ways to get the best out of your festive spending if you plan ahead. Getting caught up in the fun of the end-of-year holiday season is not difficult, but it is not easy to stop using your credit card to add to the festive feeling.

When friends are around, the children are having a good time and work is far away, it is easy to spend plastic money, although you know that in a few weeks, you will face a long, moneyless January and ask yourself, ‘How did this happen?’.

The answer is simple, John Manyike, head of financial education at Old Mutual, says. “You have let the prospect of a great time lead you when everything is designed to encourage you to spend. However, there are ways to shop and enjoy your holiday by adopting a year-end holiday plan earlier in the year.”

It is simple, he says. Put in a little planning, spend ahead and avoid the post-holiday financial stress.

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Tips for a pain-free December amid festive spending

These are his tips for a pain-free December holiday:

• Set a realistic budget that covers all aspects of the holiday. Think about the most important things first, such as your shelter, groceries, water and lights, school stationery and uniforms, then add gifts and entertainment later. Set a realistic budget and stick to it.
• Look for sales and discounts and remember that end-of-year sales are there to get rid of old stock.
• Agree with your family to set a top limit on the value of presents. That way everybody’s budget scores. If you can make your own presents, even better.
• Cut costs on holiday meals by planning a menu and cooking at home with ingredients that are on sale.
• Use rewards and loyalty programmes. It is the best time of year to redeem points for gifts or discounts and take advantage of cashback offers to reduce holiday expenses.
• Avoid impulse buying. If you are tempted to buy something, give yourself a cooling-off period before you buy.
• Shop with a list. Planning before you hit the shops means staying focused. A list will help you avoid temptation.

“When you are on holiday, it is easy to spend, spend and then spend some more. What is a week away from home if the children cannot buy takeaways for themselves and their friends when they want them?”

Getting financially wise about planning that family holiday does not mean cutting back on the fun.

“Think about booking ahead. The earlier you confirm your holiday, the earlier you can pay it off. If ‘you pay now and enjoy later‘ instead of ‘enjoying now and paying later’, your year-end holiday will be more relaxed.”

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Think twice about your holiday

If you are late in planning a festive holiday this year, consider shifting your focus to next year.

“Other benefits of acting early are that more money will be available for the family because the holiday is prepaid. The earlier that bookings are made for flights, the cheaper they are. Using rewards points accumulated during the year can also reduce these costs,” says Manyike.

“These holidays, consider using the budget to teach children the basics of money management by giving a fixed amount of pocket money rather than allowing them to spend as they please. If they exhaust the budget do not refill. Let them spend as they want and they will soon learn to be mindful of spending too much, too fast.”

Manyike says choosing a ‘staycation’ is of course the best way to have a great money-friendly holiday. You get several benefits by staying at home while everyone else is away. You can use uncrowded facilities and have time to reflect on your life and vision.

“Seriously, though, if you had a tough year financially and are dreading the costs of that family holiday, use your imagination, plan some events and enjoy being at home. That beach will still be there for you next year.”