I hope everyone had a great time this past week and enjoyed spending time with their friends and families!
Christmas is in the rear view mirror and the new year is just days away.
Over the last week, people were reminiscing about the past and in just a couple of days people will be planning for the future.
Now is the time that people start thinking about getting serious about their finances and other goals for the next year.
In that spirit, I thought I’d ask a couple of very telling questions about your spending over the last few weeks.
How Much Did You Spend On Gifts This Holiday Season?
The first question everyone should ask themselves is how much they spent on gifts and other holiday items this year. We spent about $80 for gifts this year. We ended up doing a Secret Santa exchange rather than full blown gifts for everyone like we normally do.
The Secret Santa exchange resulted in us spending just about as much as we normally would have spent anyway. However, instead of buying smaller gifts for more people, we each only had to buy one gift for one person.
This allowed us to spend a little more and get the person something we really though they’d enjoy.
If you’re not sure how much you spent this year, or if you’re scared to know, take a few minutes and log into your bank account and credit cards and tally everything up. I’ll wait a couple minutes for you to do that.
When you’re done, come back here and take a look at the next question.
How Much Did You Budget To Spend On Gifts This Holiday Season?
If you just glanced at the question above, you might think it is exactly the same as the first question I asked. However, they’re very different questions. So, how much did you budget to spend?
Did you even come up with a budget for holiday spending this year?
Hopefully you did create a budget and hopefully you spent less than or exactly what you had budgeted to spend this year. If you did, congratulations!
If you didn’t, there isn’t any point in beating yourself up over it. The past is the past, but you can learn something from this year.
How To Not Overspend For The Next Holiday Season
Maybe you didn’t budget enough for this past year or you didn’t budget at all. That’s a totally acceptable answer, as long as it is the truth! Let’s fix this problem so it doesn’t happen again.
Go ahead an estimate how much you’ll need next year right now while this year’s spending is fresh on your mind. Be realistic, if you know you won’t really stick with that small Christmas you told everyone you were going to have next year, budget for a typical Christmas.
Once you know how much you want to spend next year, add 10% as a contingency in case something pops up. If you don’t spend it, great, but it will be there if you need it.
Divide the total by how many paychecks until next Christmas and then set aside that much money from every single paycheck in a bank account you can’t and won’t touch until you start buying gifts for next year.
Whatever you do, next year make sure you don’t spend more than you’ve budgeted.
If you can do that, this year’s overspending will have been a great lesson that you’ll hopefully never have to learn again. Don’t overspend your budget for holiday gifts! Chances are, one year from now, most people won’t remember what you bought them.
Sad, but true.
So, how much did you spend? How much did you budget? What will you change for next year? I want to know how your financial holiday season went. Let me know in the comments below!