If holiday shopping and social obligations have you seeing nothing but dollar signs, you can easily turn worried about your shrinking bank account and growing credit card debt into positive steps for the coming year.
Take a little time now – in this busy month of December – to make small changes that will put you in better financial shape for 2018. Here are six tips to help you get started:
Look Back At Your Spending
If you mostly use credit and debit cards to cover your costs, its easy to look back through your statements for 2017 to figure out where your money went. It may be impossible to change your fixed costs – housing, utilities, car payments – but what about the decisions you make from week to week about what to buy and where to spend?
You may find your lifestyle contributes to major cash outlays for restaurant meals, entertainment and lots of little luxuries you really can live without. Take it to the next level and set a monthly budget for discretionary spending for the coming year, or just be mindful about how many purchases you make with little or no thought and decide to cut back. You may find your bottom line growing steadily if you reduce the number of nice-to-have, but not essential purchases.
Pay Cash for Holiday Purchases
For whatever items remain on your shopping and entertaining lists, set a dollar amount for each person or event. Then get cash, watch for sales, hit local and chain stores and spend only what youve budgeted, using all of your willpower to resist impulse purchases. Youll appreciate your credit card statement in January wont leave you speechless. Save your receipts for any exchanges and make notes about which retailers offered mid- or late-December deals in order to plan ahead for next years holiday shopping.
Shop for Upcoming Weddings
With save-the-date announcements going out as much as a year in advance, you may already know which friends and family members plan to tie the knot next spring, summer or fall. You know you cant count on sales when the time comes, but sales abound in December, the make-or-break season for retailers. Add appropriate wedding and shower gifts to your holiday shopping list and go for those great deals. Keep receipts in case the recipients need to make an exchange.
Start Planning Your Summer Vacation
Nothing helps you focus your finances more than having a fun goal in mind. If you know youll need at least X number of dollars for that family vacation or dream trip you have in mind, start now to cut back on other expenses to afford that trip without going into debt. Its easy enough to plan in advance with online bookings. If the timeframe you have in mind doesnt work out, most reservations are easy to change without penalty. Meanwhile, youll have that little nest egg to spend in a fun vacation spot.
Stock Up on Everyday Items
Holiday sales arent just for buying gifts, of course. Plenty of discount stores, grocers and drugstores offer deals in December on items like paper goods, cleaning supplies, basic cosmetics and other products you use every day. Load up your cabinets and closets now with those basics on sale and youll find your weekly expenditures shrink in the coming year.
Open a Holiday Savings Account
It wont help for this years spending but start right now to put away money for the 2018 season with a dedicated account at your bank or credit union. You really wont miss a modest contribution made from each paycheck and when it comes time to tap into that account a year from now, youll be glad you made a new savings habit. Some savings institutions even offer incentives this month for planning ahead.
Challenge yourself to try a few of these tips and then come up with your own creative ways to save a little more cash each month in the year ahead.
Five Ways to Avoid Holiday Over Spending
Six Steps to a Financially Happier Holiday Season