Taking the Stress Out of the Holidays
Ho-ho-oh no! It’s already December and that means it’s time to think about the holidays. You managed to survive Thanksgiving with the in-laws, but the Holiday heavyweight is upon us. Are you prepared?
If the thought of dashing through the snow and trimming your tree brings you less than holiday cheer, you aren’t alone. In fact, studies indicate that just about 7 out of 10 of us stress about the financial burden of the holidays, while just over half of us feel the pressure to give or receive gifts. That doesn’t sound merry and bright to me.
Most of us can agree that given ideal financial circumstances, we would love to be generous to each and every person who plays a role in our lives. After all, these people do important things for us – your daycare provider, children’s teachers, your mail carrier who has been breaking their back delivering all of those Amazon boxes, the trash collectors who haul all of that packaging away each week (seriously, it’s a TON of unnecessary packaging, but I digress). That’s not even counting your nuclear family, extended family, friends, co-workers, and pets. Buying for so many people adds up quickly and the effects of the pressure we feel to give gifts can send well-meaning gift givers into a downward spiral of stress. Sometimes, it’s just not feasible to gift the way we want to (or maybe we don’t want to…that’s okay, too!).
So, what do we do? Do we suck it up and buy a bunch of stuff we can’t afford just to make those around us feel happy one day out of the year? Do we risk making the important people in our lives upset because we just can’t do the gift-giving thing this year? Is there an in-between?
The short answer is, it just depends. There’s plenty of things you can do to show those around you that you appreciate and care for them without jeopardizing your finances. Speaking of finances…let's get the elephant in the room out of the way before we go too much further.
Your Holiday Budget
You know that budget I keep harping about in posts like this one, and who could forget this one? Yeah, that’s not a one and done kinda deal. A budget needs to be created and reviewed regularly. A good rule of thumb is to go over your budget any time there are life changes – ie: a marriage, a divorce, a new baby, retirement, illness – you get the picture. You’ll want to set aside time AT LEAST once per year no matter what life events are coming up; you know how much happens in a week, let alone a year. An up-to-date budget is the foundation of your financial wellness.
When you are planning your budget for the new year, you should have an idea of what you can spend on the holidays. This may change a bit if you get a salary increase or another unexpected windfall, but if neither of those things happens, you’ll have a defined budget that you can stick to. It may be helpful to set aside a certain amount of your holiday budget for shopping each pay period (or other frequency that works for you).
Speaking of which, do you have a Club Account, yet? A Club Account is a special saving account that you can add money into throughout the year for a given purpose. Many places (including us) will offer a club for summer vacation as well as one to help plan for the holidays. It’s a little late to have for this year, but you can absolutely start a Club Account with the intention of having it ready to go for 2020 (you can check out our full line of Savings solutions right here). This might be a good choice for all of you procrastinators out there (no judgment – I was once a member of your club…but, I found a better way. More on that in the next section).
If you’re NOT a last-minute shopper, let’s move on to my next point.
Start. Shopping. Early.
Seriously, like January, early. Your full budget might not be ready for another few weeks, but that doesn’t mean you can’t make a small purchase. Just make sure you remember to update the holiday budget amount once it’s been finalized.
Ready for my life-changing-end-of-procrastinating-holiday-shopping-tip?
Last year, my husband and I set aside $25 each pay to buy a gift for our kids (or another person on our list). It’s been one of the best choices I’ve ever made in terms of holiday shopping and planning because my gifts were not purchased last minute. I’m still sticking to my budget, but I can shop around for deals and spread out the financial burden throughout the year as opposed to taking a large lump-sum hit to my holiday shopping bucket. This also helped because when we had an unexpected financial hardship, I still had a nice stockpile of gifts so that, if it had been prolonged, my kids would still have received gifts. I honestly will NEVER go back to the last-minute shopping thing.
Plus, it’s easy to maintain. Waiting until November or December means waiting for money to become available (maybe you get PTO paid out from work, insurance rebates, bonuses…anything outside of the norm for your income) and sometimes life gets in the way. Procrastinating can put us at risk of not having the funds available to shop, which is no Bueno when trying to counteract stress during the holidays!
Ditch the Debt
This might sound odd coming from a financial institution, but there’s no need to wrack up a bunch of holiday debt. You’ll be paying for it all year and by the time it’s paid off, it’s time to add it back on again.
Sure, our VISA Rewards Credit Card is a great tool to earn reward points on all of your purchases, but unless you can pay that off each month to avoid the interest, it’s not a good idea to rely on credit cards for your holiday gift-giving.
If, on the other hand, you CAN pay it off each month, by all means, use it because the dollar-for-dollar points are amazing, plus you can redeem those points for cold hard cash (which is the best gift of all, in my book).
The same rings true for personal loans. Unless your institution offers a special Holiday Loan, it might not be worth it. Before taking on any additional debt, take a look at your budget, your credit and the effect that another account will have on your credit score. If you’re trying to boost that score up, maybe it’s worth it to have a short term loan…as long as you have the money ready to pay back.
Want even more info on your credit score and credit report? It’s no surprise…I wrote a blog about that!
Holiday Debt Take-Aways
DON’T spend more than you’ve budgeted – even if it’s on a credit card.
DO pay off the credit card each month to avoid paying interest.
DON’T forget to redeem your rewards. If you’re using a rewards credit card, you want ALL of the benefits!
DO ask your bank or credit union if they have a Holiday Loan (but only if it fits in your budget and if you can get the benefit of improving your credit score).
The Reason for the Season
If you’re guilty of over-gifting, then maybe it’s time to give back. This time of year, there are always families in need. Choose an opportunity for your family to learn what it means to help those who are less fortunate and give back to them. Maybe this means donating some toys or clothes, helping serve meals to the homeless, buying gifts for another family – whatever the cause is, this might be a way to teach your children that it’s truly better to give than to receive.
It might be hard to remember this in mid-fa-la-la-ing, but, the people who you are stressing yourself over are probably doing the same for you. Maybe 2019 is the year to start a new tradition and plan an event or activity that won’t break the bank, but where you can spend time together. I’m willing to bet that that’s more valuable to them than any store-bought gift would be.
Speaking of the store…
It’s Time to DIY
If you’re handy, you might be able to skip the store altogether. Many people prefer the thought and time it takes to create a homemade gift rather than buying one. Whatever you’re skilled at, consider turning that into your holiday gift this season. Are you a baker? A soap-maker? A card-creator? (Ha…too much fun). This is the time to shine the spotlight on what you do best and share it!
This holiday season, don’t pull the plug on your budget OR your holiday spirit. Set a reasonable budget for all of your holiday to-do’s and stick to it. Whether you’re buying gifts, making them, or giving back to others this year, you can still have a jolly good time without the stress.
Krista Kyte is a personal finance blogger and personal banker with over 17 years of experience in the financial industry. Krista is passionate about helping our members understand their financial situations. She writes tips that will help consumers reach and maintain financial security, and start living the life they’ve always wanted.
