It’s hard to believe, but the holiday season is over. A new year has started that’s full of opportunity. Whether you call them goals or New Year’s Resolutions, it’s exciting to consider the potential for 2016.
There’s one small problem. You had a great Christmas, but it was funded largely on credit cards, thus the problem – the rolling in of credit card statements over the next few weeks. If you’re how I used to be, you’ll dread opening those statements. Here’s how to handle that temptation and have a fresh start this year.
The Holiday Hangover
Gallup reported Americans were planning on spending at least $830 on Christmas gifts in 2015. That’s a lot of money, especially if not included in your budget. Much like overconsumption of food or drink during the holidays can cause weight gain; overspending will bring a financial hangover – debt.
As such, it’s not surprising to see credit counseling services increase by 25% during January and February each year as individuals deal with the reality of needing to pay off holiday debt. I love to give presents to those in my life though no gift is worth accruing debt over. That being said, it is possible to avoid the nasty hangover that comes from holiday overspending.
The Time to Start Saving is Now
You may view the holiday season as an isolated incident. You may think it’s nearly a year away so you can save money later. As I’ve learned in life, “later” rarely happens and if it does it’s often too little too late.
As Miranda pointed out a few weeks ago, the time to start saving is now. She may not have been thinking of saving for the holidays though the point still rings true. Not saving is indicative of a larger issue – living solely in the present with no planning for what will happen in the future. That can include anything like not investing in the stock market for future needs or simply not planning for holiday spending before it happens.
As you feel the pain of the holiday hangover, consider what it’d be like to shop with confidence later this year for gifts; to experience the confidence of knowing where the money will come from to pay for the given items. That confidence is addictive and, when channeled, helps grow confidence in many other areas of your financial life.
Use This as a Learning Experience
Speaking from experience, I know you want to condemn yourself for going into debt during the holidays. While there is a time to look back, now is the time to look forward and commit to stopping the cycle. That will only happen by taking the opportunity to view this as a learning experience.
For example, tips on how to avoid debt during the holidays are always popular. People want to save money, so they seek out tips to help plan. What many miss is the vital first step – planning for that shopping throughout the year. When you add planning to saving money, you set yourself up for success.
That can include something as simple as pulling money out of your bank account each month to go towards gifts at the end of the year, to deciding to cut back on such spending or something else. This will require some work on your part, but the feeling of being free of debt and having a positive net worth is well worth it in the long run.
Credit card statements will soon roll in for your holiday shopping. If you’re avoiding them, use that feeling as a springboard to change your future.