The holiday season is often a time filled with a sense of belonging and joy. However, the pressure to shop for the holidays can sometimes turn the end of the year into a nightmare, adding financial stress and distracting us from the true meaning of the season.
In fact, a startling 94% of Canadians say they expect this year’s holidays to cause financial stress, according to a recent survey from CPA Canada and BDO Debt Solutions. And nearly 40 per cent of respondents reported they expect to feel more financially stressed this year compared to last year.
Managing your holiday spending is crucial for maintaining a healthy financial lifestyle.
Here are some practical tips to help you manage your holiday expenses:
- Set a realistic budget and stick to it. Set a comfortable price point for everyone on your list. Remember to include in your budget extra items such as stocking stuffers, gift wrap, holiday cards, and tape, which can add up.
- Plan ahead. Set aside time to compare prices, find digital coupons, and search for discounts through online/flyer offers. Leverage technology in your research. Download an app to help you compare prices or find coupons—you can even set up notifications online if there is a sale on a certain item.
- Set expectations. Communicate with your loved ones, colleagues, and acquaintances about your personal situation and your limitations. Even those small office gift exchanges can start to add up.
- Get creative with holiday celebrations that won’t cost anything. Organize a staff volunteering event or host an upcycling gift exchange using items people already have in their homes. Consider giving the gift of time, like offering to babysit, or simply spend time together instead.
- Use cash. There is a mental self-check that happens when you exchange cash for an item. It is a visual reminder to be conscious of what you are purchasing. In this day and age, it is very easy to shop online and charge it to a card, and credit card statements often become “out of sight, out of mind.”
- Make your own “naughty or nice list.” Resist the urge to splurge. When you go shopping, be like Santa and make a list and check it twice. Decide on who you are buying for and what gift you are purchasing before you go shopping, so that it fits within your budget. Stick to the allotted items and try not to deviate and splurge. This includes limiting self-gifting. Consider baking cookies or giving the gift of time to anyone that doesn’t make your list.
Don’t let debt overshadow the joy of your holiday season. Focus on the thought behind your gifts instead of their price and save yourself from a year-long financial burden.
For more insights on spending habits you can take well into the new year, watch CPA Assist’s webinar Money and the Mind: Understanding the Psychology Behind Spending. In this webinar, registered psychologist Laurie Zalmanowitz examines the social, psychological, and behavioural factors that influence spending, and teaches you how to leverage new insights and your emotional intelligence to create a healthier relationship with money.
Watch the webinar recording