How to finance your festive season

Shift the celebrations

While you’re planning to finance your festive season, it often feels like you need to upscale your budget to accommodate events, parties, dinners, and celebrations. This year, however, suggest moving in the opposite direction. There are big benefits to shifting the celebrations in different ways. We recommend:

• Bargain hunting: Year-end sales season hits just before the festive season truly begins, and it’s the ideal time to pick up great bargains on gifts. Set yourself a strict budget for gifts, and go wild at the sales.

• Bulk buy your groceries: Another great side-effect of the year-end sales season includes great prices on groceries. Club together with your friends and family, and bulk buy grocery items that’ll see you through the festive season and until the end of Januworry. You won’t only save now – it’ll save you money later too.
• Get creative: Limitations breed creativity, and that notion be extended to your gift giving too. Instead of going big on gifts, make it a fun activity. We’re sure everyone will be happy to agree to a set limit on gifts, and then you can turn it into a fun activity. A limited gift budget can be used to create a whole new type of festive fun – let’s find out who can find the funniest gift, for under R150!
• Avoid the crowds: If you live in a tourist-friendly city, like Durban or Cape Town, you’ll know that the festive season attracts two things to your home town: money and crowds. Rather than jostling for a spot at a table at your favourite cafe, skip the crowds entirely and host your meetups with friends at home. Everyone brings an item to eat or drink, and nobody has to contend with crazy traffic, just to enjoy a little downtime!

Stash your savings

We know, we know! That year-end bonus seems like just the ticket for big presents and great adventures. But, we’re aiming to finance your festive season, not blow your budget before 2020. When your annual bonus hits your bank account, don’t touch it. Instead, we suggest:

• Using your year-end bonus to offset any debt you may have incurred during the year. Look for the debt item that charges the highest interest rate and see if you can knock it out with your year-end bonus. Your future financial self will thank you. Imagine starting 2020 without that debt hanging over your head!

• Stash your savings: To finance your festive season in the future, you’ll need to be saving some money every month, or as often as possible. There’s no reason why you can’t start now. Thanks to a significant shift in South African legislation a few years ago, you can open a tax-free savings account and stash savings of up to R33000 per year, and you won’t need to pay tax on it.

Spend your cash

That seems like a contradictory suggestion, but we mean it: spend your cash to finance your festive season. Of course, we don’t really mean you should withdraw all your money from your bank account and blow it all on a big day out. Instead, we recommend using a few psychological tactics to cut back on your spending. Swiping, or tapping, your card is significantly easier than pulling cash out of your wallet, and the psychological effect of spending money only really hits when you click “View Balance” on your mobile banking app, or go through your bank statement. Get a little clever with your spending, by withdrawing the amount of cash you’re willing to devote to an outing, an event, or shopping expedition. This will help you keep close tabs on your spending, and could protect you from overspending.

Set new financial goals

You’re not just setting out to finance this year’s festive season – what you do this year will affect how you can finance your festive season in the years to come. Now’s the right time to set new financial goals for yourself, your family, and your household. Try these ideas out for size:

• Aim for 2019 bills: If your grocery bills during 2019 have felt surprisingly high, don’t worry – you’re not alone. R100 does not stretch like it used to, but you can aim to keep your bills down in 2020. Set a new financial goal for grocery shopping in 2020, and find new ways to buy in bulk, plan meals more effectively, or cut back on takeaways. Your financial goal for 2020 could then be to see if you can keep your household grocery bills to the same average amount as they were in 2019. That may seem like a small thing to do, but as the cost of living rises, you might be pleasantly surprised by just how much money you save in 2020, just by setting a small goal.

• Reconsider your options: When it comes to important items, including household insurance, personal insurance, vehicle insurance, medical aid, or similar, we are often reticent to review our options, and simply gulp while accepting the annual increases that get levied for most of these essentials. During your quiet time, reconsider your options for these budget line items, and start shopping around for competitive quotes from other service providers. You may find you could save yourself a sweet sum of money in 2020, simply by shopping around.
• Start something new: Whether it’s a new savings account, cutting up your credit cards, or simply starting to think more effectively about your spending, new financial habits can only help to finance your festive season in the future. Even if it’s the simple act of putting R200 away a month, it could pay off in big ways in the future.