The Habitual Holiday Hangover
How much did you spend on the holidays this year? $300? $500? $1,000? More?
Did you also avoid checking your credit card statements this month? Or it is next month’s bill you’re worried about? If the thought of finding out how much debt you accumulated over the holidays has you wanting to hide under the covers, you’re probably suffering from the habitual holiday hangover.
Just because it’s commonly found among friends and family this time of year, doesn’t mean the hangover can’t be treated. Below are five ways to cure this year’s holiday hangover and potentially curb next year’s altogether.
1. Make January a No Spend Month
This is a huge trend among personal finance bloggers and there’s a reason why: December is the most expensive month for consumers. A No Spend Month doesn’t mean you can’t buy anything, it just means you can’t buy anything that isn’t a necessity. Pay your bills and buy food and gas, but don’t go shopping and definitely don’t eat out. Put everything extra on your holiday debt.
2. Ask for a Lower Rate
If you can’t pay off your holiday debt in January, call your credit card company and ask for a lower rate. If you’re in good standing, there’s a chance you’ll get a lower rate for a short period of time (i.e. 30 days or a few months). This can help your payments go further, so you can pay that debt off sooner and with less interest.
3. Revise Your Gift List
Write a list of everyone you bought for this year. Are you forgetting someone? And did you include all the bottles of wine you brought as gifts for people who invited you over? If so, then it’s time to revise your gift list. Start with whom you know you will be buying for next year then add anyone who you think you will be buying for. It’s ok if the list changes throughout the year, but having one at all can stop you from buying impulse gifts.
4. Track Your Spending
If you buy a gift in July for Christmas, write it down. If you buy all your gifts on Black Friday, write it all down. Don’t be fooled into thinking that holiday spending only happens in December – it doesn’t. If you keep track of it all year, you might be surprised to find out how much you’re really spending.
5. Budget for Next Year
You want me to budget for next year’s holiday season now? Yes, and it’s a lot easier than you think it is. Look at it this way: if you want to spend $1,000 again next year, wouldn’t it be much easier for you to save $84 each month to pay for it, than to put it all on your credit card in November and December? So why don’t you have a savings account or a cash jar set aside for this yet?
This is the first year my finances aren’t suffering from a holiday hangover. After a few years of splurging on my immediate family, I finally learned two more lessons. One – just because something is on sale, it doesn’t mean I can afford it. And two – if it’s going on my credit card, it’s not really a sale at all. Since it takes more than a glass of water and a couple pain relievers to fix the holiday hangover, I’m happy to have learned both.
Cait Flanders is a communications specialist working in the publishing industry. For the past year, she's also been blogging her way out of more than $28,000 of consumer and student debt. Read more from her on www.blondeonabudget.ca.