Festive Financial Hangovers
For many individuals Christmas and New Year’s is an exciting time of the year with numerous celebrations, social occasions, parties, and the expensive act of gift giving. However, as exciting as the month of December/January may be, many individuals tend to overspend and overindulge in the festivities leaving them financially hungover as we head into the new year. This article aims to help individuals fix their financial hangover whilst also guiding them in preventing the financial hangover before it can occur.
How often are you a victim of Financial Hangovers?
As the credit card bill rolls in at the end of January each year, many individuals including myself at times become quite alarmed at the debt that the previous festive season has put us in.
Financial hangovers can occur for anyone during any period of the year however, Christmas spending seems to put a bigger dent in the credit card bill that can causes individuals to become extremely financially stressed.
If you are someone who finds that you are continually financially stressed, have a look and reflect on some of your spending actions.
Are you someone who tends to…?
- Spend their money carelessly,
- Overindulge in the act of gift giving.
- Doesn’t think about the future when spending money?
With this ‘innocent money’ mindset many individuals in this position need to seek rescue, however, are too embarrassed or do not know how to ask for help. This lack of care and education can lead to anxiety, depression, high levels of stress and as most commonly the breakdown of many relationships.
At times we can all fall short of these poor spending habits, but if this is continually occurring to you then it’s time to break these patterns.
How to overcome a financial hangover:
There are many practical steps and initiatives a person can undertake once realising and accepting their financial status after indulging in excessive spending. Here are some main actions that should be taking when financially hungover.
The first thing you need to do is determine what exactly you owe. This step may be confronting and unpleasant, but once you know and are aware of the debt you are in you can being creating money-saving and money-earning methods to help overcome the hangover quicker.
If this is your first time being financially hungover or it doesn’t occur often, then simple steps such as creating a new temporary budget, cutting back on spending for a month or two, taking less time off and effectively distributing money flow are ways to effectively bounce back from your financial hangover.
However, if you are finding yourself financially hungover time and time again, a step that needs to be taking is seeking professional help (www.caretogrow.com.au)
Many individuals can feel shame & embarrassed when reaching out beyond their social support such as family, partner, and friends, but if financial stress is a common occurrence then serious changes need to be made with professional help.
When financially hungover seeking professional assistance can help overcome this stress. Professionals can help create an effective budget to overcome your debt.
They can help you implement permeant changes to your spending rather than just trying to get out from underneath this year’s hangover. Professionals can also help create ways to get out of debt, such as reviewing your bills, are you getting the best deal? Helping you reduce your interest rates, assist you in using your credit card points to pay your credit card bills and help you prepare your taxes as soon as possible (www.ngraccounting.com.au).
How to avoid financial Hangovers
Even though December is the month of spending, there are many methods you can use that will help you avoid the dreaded new year financial hangover.
Set a budget for your Christmas spending. Don’t set it at just presents, look at the big overall picture, consider additional spending on food, drinks and socialising. Make the budget realistic, no point setting a budget that will still have you in credit card debt. Try not spending more than you can physically afford.
Use savings wisely. If you’re going to spend extra at Christmas, make sure it can be financed. This might mean using money from your savings account.
Keep track of your spending. This way you can see how much more you can spend or where your money will be better off. This also helps map out your future spending once entering the new year.
Once Christmas is over get your finances in line and on track for the new year. Get a head start on you saving and spending. Start creating some financial goals you would like to achieve throughout the year.
Financial hangovers are both mentally and physically exhausting. Its time with the right guidance to start decreasing your financial stress.