Financial Hangover: 4 ways to avoid overspending this festive season

The holiday season is just around the corner! Christmas brings with it the countless reasons to go shopping and buying gifts to give out to friends and loved ones, and this season can really cause some damage to your wallet. However, holiday spending doesn’t have to take a huge toll on your budget! Here are a few tips to keep in mind as you plan your Christmas.

What exactly is financial hangover?

‍A financial hangover happens when you spend a ‘little too much over the holiday period, and you wake up in the New Year with a small bank balance. But a big bag of unwanted gifts.

So let’s avoid the financial hangover in4 simple steps:

  • Make a budget – and stick to it

Like drinking a glass of water between each gin and tonic, making a budget is your number one tool to steering clear of a financial hangover.

That means budgeting for:

  • Socialising (your work Christmas party, Friendmas, beach hangs)
  • Gifts (use this guide to help you)
  • Decorations
  • Food

The 50/30/20 budget rule says you should dedicate 50% of your after-tax income to entertainment, so try and keep the above categories within that 50%.

Credit cards, debit cards and buy now, pay later platforms making spending online simple (some would say too simple). And this can also lead to us spending more than we originally planned to.

So this year, go card-less. When you head to the shops, take out enough cash for what you need and ditch the card at home. That way, you can only spend what you’ve got, which eliminates the risk of overspending.

When you go grocery shopping without a list, you can run into trouble.

It’s the same deal with Christmas shopping. Always be prepared with a list for what gifts you need to get. By setting a list, you’ll already know how much the items cost, and whether they fit into your budget. And the bonus? You can be in and out – no need for dawdling!

  • Sell your junk – before it piles up again

Have a look around. What do you have? An old iPhone? Some old gym weights? What about some home decor you’re not into anymore? Get the market(electronic or physical market) and start selling. It doesn’t take long – and it can help you clear out your house before it fills up again after present exchanges.