For most people, the month of November ushers in a time of heightened spending. A calendar studded with holiday events, annual sales and travel expenses makes it difficult to avoid seeing more money flow out of your account than usual. Too often, people who underestimate their holiday spending end up leaning on credit cards or borrowing to meet their obligations.
If you've resolved to become more financially responsible on previous New Years, you probably know that waking up in January saddled with debt from December can be hugely discouraging. Luckily, there are a few ways that planning ahead will minimize the impact of holiday spending on your long-term balance sheet.
1. Save Early, Buy Early
While it's better to start saving for the holidays months in advance, even a miniature savings campaign in November can create a little breathing space when December arrives. If you have a savings account, most banks allow customers to arrange automatic transfers from your checking account into your savings balance. Even a daily transfer of $5 or $10 over the weeks of November will produce a small reserve for last-minute shopping in the period before Christmas.
Preparing ahead of time can not only increase your funds but also reduce your costs. Some items like airline tickets cost more the longer you wait to buy them, making it important to purchase them as soon as possible. On the other hand, most retail goods won't increase in price over time, but finalizing your shopping list now will give you the maximum time to find deals while minimizing the risk of making impulse purchases.
2. Reduce Regular Costs and Incidental Purchases
If you don't think your checking account balance has room for any regular savings plan, you may want to start by trimming things out of your standard expenses. Things as simple as brewing your morning coffee at home and using your kitchen to cook for yourself can add up to the same effect as putting away a few dollars each day.
Incidental purchases for yourself should be reduced to a bare minimum, and eliminated entirely if possible. If you're expecting gifts of your own, find out whether your closest friends and family are interested in sharing wish lists. Being forthcoming about expectations makes for happier results, and turns a stressful guessing game into an opportunity to give and receive presents that contribute positively to budgets and to daily life.
3. Shop for Retail Purchases Online
Shopping through the Internet carries obvious benefits for your bank balance. Aside from having access to a much wider variety of products, you will find it far more convenient to compare multiple vendors who sell the same item at different prices. And while seasonal sales events like Black Friday are one of the most cost-effective times for brick-and-mortar shopping, Internet vendors also offer improved retail offers available to anyone who visits their websites.
In addition, shopping online can give you more control over the spending process. At home, you have the option to step away from shopping whenever you choose; when you physically travel to a store, you might feel pressure to "make the most" of the time you've invested and push yourself into a purchase decision. Additionally, when you shop at home, it's very easy to keep your bank's online app or a recent statement close by, making it easier to do your shopping with a clear idea of what you can afford.