With Christmas not far off, some of us are about to see our rands transmuted into turkey and tinsel.
I asked Bongani Sithole, head of entry level marketing at Liberty, how we can avoid debt at this perilous time of year, when we often take leave of our senses and overspend, forgetting about New Year needs like school fees, uniforms and so on. There’s nothing worse than struggling to make ends meet in January and February.
Here are some of Sithole’s suggestions:
- Start shopping early. Having time to choose the right gift will help you to stick to a budget.
Buy a few items each month: it helps you stay out of debt.
Ideally, shop for Christmas all year round — collect gifts as and when you can afford them without putting yourself under undue financial pressure.
Stores don’t put up their prices at Christmas, but they do bring in higher-priced items to cater for those who like to treat themselves. Avoid temptation: stick to a list and a budget.
Get into the habit of putting money aside for the post-Christmas sales for the following year’s gifts.
If one gift cost less than expected, don’t use the “bonus” to buy a more expensive gift for someone else. Save the money.
Avoid impulse buys. Wait a day or two before you cough up and examine your motives for giving. Choose something you want to give, not something you feel you should give.
During the festive season, ask out-of-town visitors to chip in for groceries.
If there are a lot of nieces and nephews in your family circle, consider pooling resources. A family can budget R150 for each child and they will each get one decent present instead of 20 cheaper items that everyone knows are duty buys.
If you are overextended, have a frank discussion with family and friends. No one will object if they know you are under financial pressure. Make a determined effort to get out of debt for the following year.
Gifts don’t have to cost money: a gift of your time can be very valuable. Offer to help someone with a home improvement project or babysit for friends to give them a break.
Prioritise important bills. Ensure there is enough money to cover debit orders, especially for your medical aid, investments and insurance policies.
Work out holiday costs and be realistic about what you can afford. If taking a vacation means maxing out your credit card, then you can’t afford to go. If you sacrifice one annual vacation it may help to pay off debt and be better off the following year.
Watch out for those extra bills that land at Christmas. Policy renewals and school uniforms can take a big bite out of your resources.
Beware of guilt buying. Many people overspend out of guilt or a feeling of obligation. Examine the feelings behind your desire to buy someone an expensive gift. Rather fix the underlying issue. Problems do not go away with gifts — they go away when they are discussed and resolved.
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