The holiday season is right around the corner. Soon enough, the office doors will close for Christmas and for a while you’ll enjoy reconnecting with family, eating just a little more than you should and unwinding from that end-of-year deadline stress.
By the time the holidays roll around, you’ve been balancing your personal finances for gift buying as well as dealing with everything else life throws at you. It’s not uncommon to feel stressed, tired and more than ready for a break. But the last months of the year shouldn’t have to be crunch time, just so you can enjoy a week or two of festivities. This year, find a way to live with your money all year round, rather than working to live in the run-up to Christmas.
Having a financial plan in place is about more than just budgeting. A comprehensive financial plan is about aligning your income and expenses with your values and goals. While a budget is important, it focuses primarily on money out and money in. Meanwhile, your financial plan should address what you’re achieving with your money. Are you growing your wealth and is your spending contributing to or harming your happiness?
A financial plan for the holiday period ensures your spending stays in line with what – and who – matters most.
You should have a financial plan in place throughout the year, but during the holiday period it becomes particularly important. Almost half of Australian parents surveyed by Groupon indicated money was their biggest cause of stress in the lead-up to Christmas. Micro-managing a budget, checking your expenses daily and fretting over your spending is a one-way ticket to financial burnout, especially when you’re also managing year-end work. Instead, constructing a financial plan in advance of the holidays ensures you’ve considered your allowances for gifts for the family as well as your own need to take time out and de-stress.
Part of your financial plan should be the automation of your fixed costs. Many service providers offer automatic direct debit payment and may even apply a small discount to your monthly bills for setting one up. Otherwise, you can establish automatic payments using most online banking platforms.
Automating your money removes the manual task of going through and paying every bill. While you should still be checking your payments have processed properly, reducing the time it takes you to manage your money can help to alleviate some of the end-of-year stress.
Focus on family these holidays – not your finances.
Lastly, it pays to make time away from your finances. It can be difficult to find ways to have fun between working hard and managing a tight budget. This is the perfect time of the year to look for means to unwind that don’t involve money.
Every day we’re bombarded by opportunities to spend, which can cause us to analyse our finances constantly. Avoid financial burnout by prioritising one hobby you can enjoy without stressing about its impact on your budget. Join a local community group, or visit a friend or family member (even better if you can do so without using fuel). Your local library is also an excellent source of free, low-intensity entertainment.
What you need to know
This information is provided by Invest Blue Pty Ltd (ABN 91 100 874 744). The information contained in this article is of general nature only and does not take into account the objectives, financial situation or needs of any particular person. Therefore, before making any decision, you should consider the appropriateness of the advice with regards to those matters and seek personal financial, tax and/or legal advice prior to acting on this information. Read our Financial Services Guide for information about our services, including the fees and other benefits that AMP companies and their representatives may receive in relations to products and services provided to you.
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