It is holiday time again, the time to relax and have fun. However, a holiday that comes with the luggage of financial stress or credit card debt is not a holiday. The best way to avoid post- holiday financial stress is preparing a budget. Below are 6 tips on how to budget for your holiday.
1. Start Planning Early
Family holidays can be cheap if you plan ahead. This is because you will have more options in terms of destinations and activities. You will also be able to tell how much to spend on different costs such as travel expenses, food and gifts.
You can put some money in a high yield savings account. This higher the rates you make the better. This is because you will be able to meet the budget for your holiday easier.
2. Make a List
Having a list will help you determine what you have. If you can only save $600 for your holiday, it is better to know how you will spend it before you start shopping. By doing this you will avoid damage control after the holiday.
Gifts are some of the items that make a holiday budget overflow. But it is good to understand that holiday expenses do not stop at gifts. The best way to avoid overspending on gifts is to include everything in the list. Include travel expenses, food, gift wrap and household decorations to avoid surprises.
3. Check the list twice
After making a list, give it another look to determine if you can eliminate someone from gift list. Do your mailman and your hairdresser need a gift? These are some of the people you can remove from the list.
Buying gifts for family members is important, but if buying for everyone in the family is more expensive, you can buy a group gift, something they will all appreciate.
4. Think off Peak
Most destinations offer remarkable discounts during their off-peak seasons. Visiting some places during winter may be very expensive, but the same lodges and chalets offer amazing deals for summer.
However, it is good to do some research on weather conditions during off peak seasons. This is because some places might come with the increased chance of bad weather during off peak.
You could consider going somewhere in the southern hemisphere. For example New Zealand. I personally recommend going to Queenstown, which is full of great cafes and bars. Alternatively you could try going to Auckland which is full of world class restaurants.
5. Use Cash rather than Credit
It is good to use cash rather credit during holidays. This will help you obey your budget. However, that does not mean you move around with big wads of money. Most banks nowadays provide travel cards that are welcoming when it comes to holiday spending. Your bank will load your travel card in the currency of the country you will be traveling. The card works just like a debit card for cash withdrawals at ATM’s and for purchases.
6. Avoid Emotional Purchases
Let face it, when we are stressed we spend more. The only way to avoid emotional purchases is to take emotions out of the holiday purchases. Stick to the budget and ensure you are not caught up in the excitement of black Friday sales. Do you need another DVD or another TV, probably not.