December is a tough month for most consumers. Due to the festive season and businesses closing, employees usually get paid a bit earlier. This may seem like a lifesaver at the time, but can cause problems come January.
By getting paid early in December and then on the normal date in January, consumers often have a 6-week gap between the two pay dates. Early planning is required ahead of this time.
Start Planning Now
The festive season is an expensive time for most people. Gifts, celebrations, dinners and holidays can be a costly affair. In a normal month, these extra expenses could cause consumers to spend more than they earn, or use credit to fill the gap.
Here’s what you need to try and do before December comes:
- Create a solid monthly budget leading up to year-end
- Start saving for the extra festive season expenses
- Try settle some smaller debts to free up cash flow
- Plan to save some of your year-end bonus
- Try opt for cheaper, more affordable holiday outings
- Get the whole family involved in the budgeting exercise
Make Sure You Can Cover All Obligations
There are some expenses that cannot be avoided. Things like rent, water and electricity, groceries, school fees, petrol/travelling costs are part of your monthly expenses. You then need to add all the debt repayments. Credit cards, store cards, vehicle finance, home loans, personal loans and pay day loans.
Once you have added up all of these things, you get an idea of your minimum spending requirement. It’s important to try and save money on the variable costs in order to minimize spending and maximize savings.
Try To Avoid New Debts
It can be tempting to take out new forms of debt to cover the festive season costs. By carefully planning an budgeting, you can avoid this completely and use the cash you get paid instead. It doesn’t help to take out loads of debt and then think you only have to worry about it next year.
If you are already struggling to make your current debt repayments, speak to a debt counsellor for help. Debt counselling can reduce your monthly debt repayments by up to 70%. It allows you to free up cash flow and focus on repaying your current debt, not get you into any more.