January is the month when a lot of people avoid opening their credit card statements, and for good reason – the December spending spree creates a nasty debt surprise for millions of people around the world every year.
December is the month when most South Africans overspend, with year-end coastal holidays, Christmas, and the new school year taking a serious bite out of most family finances. Despite many workers receiving bonuses in December, it’s rare to meet someone who starts the year with solid finances – let’s aim to be that rare person.
Preparing for the holidays
As spring approaches, the familiar sight of Christmas decorations won’t be far behind. While some people may criticize retailers for pulling out the lights and Christmas trees earlier each year, the red and green should be a signal for all of us to start saving.
The months leading up to December are the perfect time to save up – warmer weather should reduce your electricity bill and outdoor activities may take the place of restaurant dinners and movies in your leisure schedule. You should aim to have enough spare cash to cover your extra expenses in December before the month begins.
Reducing the holiday bill
If you find yourself broke and in debt at the beginning of most years, you may be spending too much during the festive season. Celebrating the holiday season without racking up debt may seem tricky, but you don’t need to be a scrooge to start the year on a good financial footing – here are some ways you can enjoy the end of the year without going into debt.
- Do you need that two week holiday in December? December is the most expensive time to book flights and accommodation anywhere in South Africa. You may want to celebrate at home this year and take your holiday in November or late January after schools re-open.
- Christmas on a budget – For those of us who celebrate Christmas, the cost of entertaining, buying gifts, and other expenses can be huge. By setting yourself a Christmas budget, you’ll find smarter ways of spending your money and still enjoy the holiday with your family.
- Getting away from it all – A package holiday booked and paid for in advance may be ideal for some people during December. An all-inclusive package may cost a little extra, but if you save up and pay for it months in advance you’ll be away from shops and other temptations and when you get back, most of your December salary plus your bonus will still be there.