It’s February already. It seems like we’ve only just returned to work the other day! But here we are, now almost at the end of February. As I was working on my budget for next month I remembered that now is the time to start budgeting for Christmas expenses. Yes, that’s right. That, for me, is the easiest and the most effective way to budget for Christmas: several months in advance!
While at times it may be tempting to rely on your employer for providing a Christmas bonus along with your December pay to take care of your expenses over the holidays, it’s worth reminding yourself that a bonus is just that – a bonus – and by no means compulsory. We never know what the year ahead has in store for us or our employers. What if their business doesn’t do as well as projected? In which case, there may be no bonuses for anyone in December. Even if all does go as well as planned, or better, and you do receive your Christmas bonus, wouldn’t it be nice to save most of that money or use it for something other than Christmas gifts, food and drinks?
If you’re keen on starting a budget for Christmas expenses now, a good place to start would be to go through your bank statements for November, December and January and look at the total amount of money you spent over the holidays. This should include all the Christmas gifts you bought, the Christmas lunch you paid for, out of town trips, outings to the cinema, restaurants and bars as well as your bills for entertaining family and friends in your home. You should also include any other Christmas related expenses that you and your family had.
Now that you have the total amount all tallied up, think for a moment about the number that’s in front of you. Are you happy with the amount? Or are you a bit surprised at how much you’ve actually spent? Either way, you’ll have a much clearer picture of how much Christmas cost you last year.
If you’re happy with the amount, and you believe that it’s pretty much what you would like to spend over the Christmas holidays this year as well, go ahead and add an extra 5% of your total amount to anticipate the projected inflation rate for South Africa for the remainder of the year. If, on the other hand, you feel that you would like to, or possibly even should, spend a bit less this year, then decide on a figure and work with that.
There are 10 pay-days left from now until November this year. Divide the total amount you have in mind by 10 so that you know how much you would need to put away each month, starting now. You may also want to keep the money stashed somewhere where you can’t get to it too easily, or better yet, if you can open a save-for-a-purpose bank account, with no extra charges per month, then do that and forget about this account until you need to add money to it or until it’s time to spend it.
If you’d like to save up for just the Christmas gifts, and you feel that you may need to be a bit more disciplined in your approach, why not consider the following ways of budgeting and saving:
- Include a R50.00 or a R100.00 gift voucher in your monthly budget, starting this month. Choose your preferred retailer, or even a preferred shopping centre/mall, and the next time you’re there buy your gift card!
- Don’t use but rather save all your Dis-Chem points or Clicks cash back vouchers and use that to buy Christmas gifts towards the end of the year.
- Save all your R5.00 coins in a jar throughout the year and use that to add to your budget for Christmas gifts.
Budgeting for Christmas expenses, especially gifts, several months in advance means that you will have access to a bit of cash to buy gifts throughout the year if you come across something really nice or very affordable, but hopefully both! Unless it’s a perishable item, and most Christmas gifts usually aren’t, there’s no reason why you can’t buy the gifts in advance. This will save you the mad dash through crowded malls later in the year, trying to find the perfect gifts for your loved ones.
Also, if you allocate a specific amount of money to be spent on each gift, for example, and work towards finding something for that amount, this will make your Christmas shopping experience a lot more fun as you look for ways to be more creative, more thoughtful with your gifts.
Do you budget for Christmas expenses from early on in the year? Or do you have a different budgeting method that you use? Please share your ideas in the comments below.
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