The holiday spirit can get the best and the worst out of us. While on one hand, the holiday season is for celebrations with our near and dear ones, it might also drive us crazy with the sheer spending involved! With stores and online shopping platforms offering great discounts, coupled with our own urge to splurge, it’s hard to resist unnecessary splurging during the holiday season.
Most impulse buying is driven by emotional spending, which can be fairly harmful to your personal finances. It’s important to understand the psychological triggers and watch out for them to keep emotional spending in check and tackle them to maintain healthy personal finances.
Another driving force behind the spending spree, is, of course, societal pressure and expectations that emerge during the holiday season. Extravagant holiday parties, gifting, and celebrations have become the norm.
This not only causes stress but can inevitably wreak havoc on our personal finances.
So how can we recover from the holiday spending spree?
There is a good chance that you might have fallen victim to the above factors and have driven your savings to the ground. While there are plenty of financial lessons to learn for all of us, here are a few specific tips to help you bounce back from the spending spree post the holiday season and start working (again) towards building healthier personal finances:
- Build an emergency fund
With your savings severely hit by the holiday season, it is time to plan your future expenditures carefully and think about creating an emergency fund. An emergency fund will act as a buffer for any foreseeable or unforeseeable expenditures. It may also be used in the next holiday season.
A systematic emergency fund will ensure that you do not end up straining your savings after every holiday season. To know more about how to create an emergency fund to maintain your personal finances, click here.
As a corollary to building an emergency fund, start thinking about saving and investing it, no matter what your income or age is. Smart investment choices can go a long way in regaining balance as far as your personal finances are concerned. Here’s a guide on how to start investing.
- Think about saving quick bucks
Concentrating on essential commodities and doing away with wasteful spendings on things like going out or eating out can go a long way in helping the recovery post the holiday spending spree. There’s always a cheaper alternative to these.
You can follow small steps like unsubscribing the shopping newsletters or uninstalling shopping or food delivery apps from your cell phone to curb the temptation to indulge in these non-essential expenditures.
- Alternative income stream
It may also be a good time to pick up a part-time job or a freelance gig to support your income. The extra bucks will help you achieve a balanced personal financial setting, post the holiday season. Today, it’s so much easier because a lot of organizations are offering remote working due to the COVID 19 outbreak.
- Be nifty about your shopping
Since shopping would obviously entail expenditure, go find creative ways to save money while you shop. For instance, try using 3rd party cash back apps or websites, coupon codes, or wait for things to go on a sale on the next festive season. Defer making any large purchases till next holiday season sale and till then save money for it.
You can also try finding cheaper alternatives for things and brands that you use. A lot of homegrown brands have dupes for international brands at a fraction of the latter’s price.
- Consider neobanking
Switch to neo banking from regular banking to save extra money and get a more customized banking service. It is a far more hassle-free and easier to operate model, and you get complete control over your personal finances in a more well-rounded manner. Neobanks are often superior on tech, enabling you to track your personal finances and gain insights on the financial side of you. As you can guess, this can be especially useful during (and post) the holiday spending spree. To know more about the benefits of neo banking, read one of our earlier blogs here.
The holiday season is an economically taxing time for all of us. It can be even tougher for millennials who are usually bashed for their personal finance choices. But proper guidance never hurt. These tips should hopefully nudge both that demographic and the others in the right direction as far as personal finance management is concerned, especially post the spending spree during the holiday season.
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