It’s the holiday season! Here are some top tips to manage your holiday financial planning.
The holiday season can be a fantastic time of year. It can bring joy, time with friends and family and lots of fun festivities. Unfortunately, it can also often be a strain on your finances.
At Stapleton Finance we certainly understand the challenges of managing holiday expenses. As finance brokers, we’re often called upon to offer our advice on how to manage this more expensive time of year. So, here are our top tips to get your finances ready for the holiday season, while also maintaining your long term financial health.
One of the most important, but overlooked elements of your holiday financial planning is to set a budget. Too often people think they can just buy a few things here and there without seeing too much of an impact. But if you have a family, or just enjoying doing all the holiday things, it can add up quickly.
Start by reviewing your income and expenses to determine how much you can afford to spend. Then choose a realistic budget that will allow you to celebrate the holiday without impacting your financial health. If possible, commit to a no debt Christmas, and spend only what you can afford to spend.
Remember, the best holiday memories aren’t about how much money you spend but about the memories you’re making with your loved ones.
Once your budget is set, list everything you need to spend this holiday season and how much you plan to spend on each of them. This has to include gifts, of course, but also any travel, food and entertainment you might need and want.
Once you’ve planned your spending stick to it! This helps prevent overspending in one area and ensures you cover all of your holiday expenses.
Now you know what your budget is and what you plan to spend, it’s time to start saving. If possible, start putting aside a small amount of money each month, or spending a set amount out of each pay cheque, before the holiday season. This can ease your financial burden and help your holiday financial planning.
If you have a rewards credit card or loyalty program memberships, the holidays are a great time to redeem your points. You can often use these to cover travel expenses, for gifts or even for grocery discounts. And using accumulated points can bring you significant savings.
There are often good deals around the holidays, and it pays to seek out these discounts and sales. Shopping during sales events like Black Friday or Cyber Monday is also a really good idea. Just be sure that you’re buying things you actually need, rather than just because something is on sale.
Negotiating with lenders is very common. And sometimes you might be able to simply call up your lender and ask for an interest rate reduction. If you’re willing to refinance (which is simpler than you might imagine!) then your lender might be willing to work with you to keep you as a customer. Particularly as the market cools near the holidays.
Your mortgage broker can certainly help with this process. And getting a lower interest rate is an excellent tool in your holiday financial planning.
The holiday period is often also the bonus period! While that’s great news for anyone that’s on a bonus package (or who gets cash gifts from family), it can also be easy to think of this money as ‘free money’ to spend on whatever you wish. This can be a risk if you’re trying to stay on budget.
Instead, make sure you include this money in your income when you’re setting your budget. And then use it in a way that makes sense for your long term financial health.
The holidays might be the perfect time to review your mortgage and other loans with a home loan health check. This way you’ll be able to see if you’re still getting the best rates and most favourable terms.
If you find that you’re not, consider talking to our team about how you can get a better deal. Even a slight reduction in interest rates can translate into significant savings over time.
If you have multiple high-interest debts, you can consider consolidating them into a single loan with a lower interest rate. Sometimes this can be beneficial, as long as the terms of the loan are also aligned. It doesn’t make sense to take a two year loan and consolidate it into a 30-year loan for example, as you’ll end up paying a lot more over the lifetime of the loan.
However, if you have multiple loans with similar loan terms, consolidation can help you simplify your payments and save you money.
Finally, it’s worth speaking to our about your refinancing options or even cashflow loans. Both of these can provide an extra boost and potentially reduce your overall interest payments. However, only an expert who understands your specific situation will be able to give you the right advice – so get in touch today!
The holidays don’t have to be a financial burden. With just a bit of holiday financial planning, you can enjoy the season without worrying about your wallet. And if you find that Christmas spending has put you at risk of mortgage stress, get in touch with our team right away. We can help you manage your risk and keep your financial health strong!
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