The festive season is finally upon us, which means there is more time to kick back and relax. However, it is also the time in which many Australians find themselves losing track of their spending, leaving them with a holiday debt. Here are five tips to help you better manage your Christmas expensing without busting your budget.
1. Track the way you spend
Keeping track of what comes in and out of your account is one of the important things that you could ever do for yourself this festive season. According to UBanks latest report, 86% of Australians do not know their monthly expenses. This could be an easy way for many Aussies to fall into a debt trap that can soon become out of control. Therefore, tracking your expenses before the holiday mode kicks in is essential.
2. Create a Budget
Make a budget and check it twice before the holiday season picks up. UBank found that 28% of Australians make use of financial management/budgeting tools, while 31% of Aussies said that they are yet to make use of such tools. Budgeting all the things that you need to buy such as food, gifts, travel expenses, entertainment expenses, and more. You can hold this against the current finances that you have available and weed out the things that you do not really need to spend money on. The aim is to have a relaxed festive season that doesn’t leave you with a financial holiday hangover.
3. Pay off existing debt
Spending money to spoil yourself to ease of the stress is something that many people do. However, doing this while you still owe money on various loans and credit cards can be similar to shooting yourself in the foot as your debt will accumulate. You can consider taking out a personal loan to help you consolidate your debt and spread out costs. However, ensure that it is affordable and comes with repayments that are work with your cash flow.
4. Curb shopping online
It’s fast, it’s convenient, but shopping online is one of the ways to easily lose track of your finances and start accumulating debt on your credit card. If done properly, shopping online can help you get access to discounts and sales that can actually have you save. But the best rule of thumb that you can use when shopping online is that if you have not budgeted for it then you shouldn’t place it on your card.
5. Compare your options
One of the best gifts you can give yourself this festive season is to compare the options that are available to you than rushing in to purchase things. This means that it is vital to compare your options when it comes to your loan options and prices for items that you have on your bucket list. Instead of putting everything on your credit card or taking out a loan to finance it ask yourself if it is not possible to pay for it with your debit card or cash.