The holidays are supposed to be the most wonderful time of the year. At least, it is if you believe the popular Christmas song of the same name, but anyone living on a tight budget knows this isn’t always true.
Money has always complicated how low-income individuals can celebrate, but this year, our first COVID Christmas adds heaps of financial stress to the situation. It’s challenging to take on the holidays when you’re still reeling from the effects of the pandemic.
If you feel like a raw bundle of nerves in the lead up to the holidays, there are ways to manage your anxiety. Check out these money-savvy tips below.
Sit Down with Your Finances
If you were one of the worst-hit by the lockdown, you might not have any cash set aside for a seasonal shopping trip.
Research from SimplyWise shows roughly 40 percent of Americans who lost their job or saw a reduction in their take-home pay have very little savings at all. In fact, one in five respondents wouldn’t be able to survive for more than two weeks on savings.
Without savings, your priority may not be the holidays. You may be wondering how you can help your financial situation should an unexpected emergency expense arrives in your stocking this year.
Take the time to understand how vulnerable you are to unexpected expenses. If you don’t have any savings squirreled away, you may want to compare direct payday loan lenders with installment loan lenders. This way, you’ll have a better idea of awaits you if you need to borrow money in an emergency.
Use a Budget
People who use a budget are more likely to spend less. That’s according to YouGov, which found the average shopper with a budget spent $703 on the holidays. This may seem like a big bill, but it’s more than $300 less than the national average.
While you may not be planning to spend $703, you won’t know your cap until you look at your budget. If it’s been a while since you last made yours, track your expenses from the last three months. This will show you how much money you tend to have leftover after you pay your bills.
If you aren’t happy with the results, look to small purchases for savings. You may be able to put more cash into your holiday budget if you can cut out subscriptions, takeout, and late fines in the lead up to the festivities.
Focus on Experiences Rather Than Gifts
Remember what the holidays are truly about. It’s not the gourmet dinner with ten courses, nor is it the mountain of presents waiting for your kids under the tree. The holidays are about spending quality time with the people you love.
It’s not always easy shifting your priorities like this. Christmas and consumerism have been strong bedfellows for a long time. However, with some hard work, you can find cheap or free alternatives to your usual gifts.
Focus on handmade items or acts of services if you must wrap something up for the big day. Otherwise, brainstorm with your family how you can celebrate the season together.
Money is often the source of holiday stress, but it doesn’t have to be. Do what you need to do to put your finances out of mind during the festivities. Manage your expectations and set a practical budget. These things can help you tamp down on your anxiety during the hustle and bustle.