Ten tips to avoid overspending at Christmas

I recently did a talk with the fabulous fitness guru Virginia.  If you don't follow her Moozlers Facebook page, then go check it out.  It's full of useful health, fitness and life tips.  At the recent event, she talked about how to avoid gaining weight over Christmas and I talked about how to avoid overspending! Whilst Christmas is a time of joy, love and giving it can also be a time of stress, particularly when it comes to your money.

Here are my top ten tips for ensuring you start the new year with your bank balance intact.

1) Plan, plan and plan. Failing to plan is planning to fail, and your Christmas spending is no different. If you don’t want to blow your budget, you have to first set one. And having it in your head is not a plan. It’s a wish. A plan is written down, preferably in a spreadsheet. Leaving it until the last minute is a recipe for disaster, so get organized today.

"Failing to plan is planning to fail"

Start with the amount of money you can afford to, or want to, spend. Then write the name of every person you need to, or would like to buy a gift for. Don’t forget all the people that you like to thank…your helper, gardener, pool man, teachers. Then put an amount by each name and play around until you are within your spending allowance. Then include all the other extras…entertaining costs, a new outfit for the Christmas party.

2) Entertaining is horribly expensive.  If you are throwing a party or hosting Christmas at your house, be sure to include it in your spending plan.  And share the load!  People love to help by bringing a dish or a bottle, and it can drastically reduce the costs for you.

3) If things are financially tough this year, be honest about it.  Tell people you can’t buy extravagant presents.  You don’t have to say “I can’t afford it”.  Just say “this year I am being responsible about my money and overspending is not in my plan”.  There is no shame.

"This year I am being responsible about my money and overspending is not in my plan"

4) If you have to put it on your credit card DO NOT BUY IT.  Simple.

5) Be creative.  People love creative gifts.  If your friend is a busy Mum offer to look after her kids for the afternoon so she can take a nap (this would be the best Christmas present anyone could give me!).  Set up a Christmas swap party where each person has to bring ten things that they have never used before.  Clothing, cosmetics, toiletries….look around your house….you will be surprised what you find hidden away in draws, at the back of cupboards.  Get all your friends together, drink some wine and shop for free!

6) Remember that no one wants more stuff.  No one.

"No one wants more stuff"

7) Be very careful who you go shopping with.  Make sure your shopping companion is like-minded and compassionate.  If you are worried about getting carried away in the shops then online shopping can bring more discipline, but be sure to take shipping and duty costs into account.

8) If you have a big family think about doing a Secret Santa so that you only have to buy one gift.  My family use the Elfster website and we have a huge amount of fun with the guessing games that go on for hours on Christmas day.  We put a spending cap of $50 on the gift and that’s it.  One present for one person, $50 total spend.  It has made Christmas so much less stressful, less expensive and more fun.  Isn’t that a win-win?

9) If you are very organized and buy presents early in the year, don’t forget what you have!  I have done this before – stashed things away in a cupboard and then totally forgotten about them.

10) I say this over and over again, but money is emotional.  Spending is emotional.  If you find yourself overspending and buying extravagant presents for lots of people, stop and ask yourself why?  Is it out of guilt?  Are you compensating for not spending enough time with them this year?  If spending simply gives you a high, a feeling of euphoria, then you need to do some work on your money mindset.  You need to shift from feeling euphoric about spending to feeling euphoric about saving.  It’s about slowly starting to feel a great sense of achievement and confidence from seeing your bank balance grow.  Believe me, it’s possible!

Our emotions can run rampant when it comes to our money and often lead us to bury our head in the sand.  If you are going to do anything in the New Year, make embracing your financial life one of your resolutions.  I am going to make it easy for you.  I have a new series of events that I will be launching that will leave you feeling more optimistic and inspired about your future as well as more determined, more disciplined and more responsible when it comes to your managing and investing your money.  Keep watching this space!

If you want to chat before then, as ever, I am here.  Drop me a line at gloxton@ifp.ky to schedule a meeting.