The end of the year is supposed to be a relaxing time for all. It’s – hopefully – when things at work start to wind down, when you can finally go on that much-needed getaway, and when all your loved ones get together under one roof to reconnect and celebrate Christmas.
However joyous the season of giving may be, it can also get quite tough – not just emotionally, but on our bank accounts, too! Between finding new (costly) activities to keep the kids entertained on a daily basis to making sure the Christmas feast is delicious, and buying memorable gifts for loved ones, your work is definitely cut out for you.
The season is made to be enjoyed, though. Transunion Africa’s CEO Lee Naik has offered some simple, and invaluable, advice on how you can take the financial pressure off your shoulders.
- Have a strategy. Avoid buyer’s remorse by going into this festive month with a budget and the right information to make informed shopping decisions. Familiarise yourself with the prices before you head to the shops, so that you know what a good deal looks like. Stick to your list and avoid any impulse buys, such as that fruit cake you buy every year yet none of your family members like.
- Avoid the debt trap. You probably aware of this already but know exactly what your monthly income and expenses are, as well as your debt obligations. This will dictate how much you can afford to spend on gifts and luxuries this Christmas. Don’t overextend yourself to make loved ones happy; it’ll just cause distress later on (it’s not called ‘Janu-worry’ for nothing, after all).
- Get smart with your payments. Don’t forget that the interest rate is expected to increase next year, which means you’re going to be paying more for your debt, including your home and personal loans, and your credit cards. Always pay off your high-interest credit facilities first and, if you have to take on new credit, shop around for the best interest rate. However, that doesn’t mean you have to buy an expensive phone or tablet on credit just because it’s on your children’s ‘wish list’. Rather make them save for items like that – they’ll appreciate them more in the long run.
- Keep an eye on your score. Your credit score offers insight into the state of your finances. Keep up to date with your credit profile, and look out for any warning signs that might lead to a negative credit assessment. So don’t resort to using your credit card just to ensure there are enough presents under the tree. A moment of joy can’t make up for months of worrying about how you’re going to meet those repayments.
That doesn’t mean you can’t enjoy your holidays, though. Just make sure you think twice before filling up your trolley with treats that no one will eat, or buying that expensive Christmas Day outfit when you have an equally stunning dress sitting in your cupboard at home. Shop wisely!