It is spring and the end of the year is not far away, along with the expenses that come with entertainment, festivities and holiday time.
“You may be shaking off the winter blues and enjoying the start of spring, but now is the best time to start planning for the year end,” says Eunice Sibiya, head of Consumer Education at FNB. “With enough time and planning you will be able to get over the festive season without the stress of adding more debt.”
The festive season is the time that most people overspend, and the consequences of this can be felt until well into the New Year
“This year, make a conscious decision to plan appropriately, get all your finances in place and have a great end of year rest without money worries,” says Sibiya.
Review the previous year
Every year South Africans are ‘surprised’ by the amount of money they spend over the end of year holidays, vastly underestimating what they think they will spend. For example, FNB Credit Card sees on around 30% spike in spending over the December period.
“This year, before the fun and party season is upon you, go and have a look at your bank statements from the last year,” says Sibiya.
This is easy to do as bank statements are now available from most banks on a digital platform (don’t go into a branch to do this, it racks up unnecessary costs).
“Go through very carefully all your expenditure over this period,” says Sibiya. “Add up all the spending including, your credit card, any cash that you withdrew and anything spent on your cheque card. Don’t be tempted to cheat as you’ll only be cheating yourself.”
You should then have a real view of what you spent last festive season. You may have to go through your statements from before the December holidays if you booked holidays.
Put a plan in place
With an idea of how much you spent the previous year, plan for this year.
“If you felt the consequences of your spending you need to put an action plan in place that will stop you making the same mistakes this year,” state Sibiya.
Draw up a budget and decide on a way to tackle it.
“This can be tough as there may simply not be the money to go away for the holidays this year,” says Sibiya. “But with a plan you can at least make informed decisions before the time.”
Put away money from now
There are four months until year end, so part of your plan should include putting away money each month for a nest egg to get you through the period. Even it is a small amount; a few hundred rands will come in handy.
“While finances may seem tough, think of the end goal,” says Sibiya. “Find ways of cutting down for the next four months, with the end goal of having a great year end with friends and family.”
Get buy in
Good planning may require the input and influence of your family.
“Have an open and honest conversation with your family, or anyone that needs to be involved in your finances,” says Sibiya. “So if you make the decision together, such as working towards going on a holiday at the end of the year, everyone will be more inclined to help get to the goal”
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