1. Create A Budget
A budget provides a straightforward way to manage your finances, creating an even better avenue/opportunity to save up for something, say a holiday. One of the advantages of creating a budget is that it will guide you on what to spend money on and what not to, which again reduces the risk of impulse spending. That said, the first step to saving up for a holiday is to have a reliable way of managing your finances first, then everything will fall in place.
Don’t just formulate the budget in your mind, but rather write it down. Take time to allocate how much money will be needed, for, say, a hotel or travel expenses, then set a ceiling for the same. You also want to budget for even the most unlikely of expenses, such as gifts you’d want to gift a loved one or a souvenir from the holiday. Writing everything down will give you an idea of how much you are likely to spend on the holiday, then start saving towards that. Ensure that you get the best deals take a look at Glasgow hotels | My Hotel Break.
2. Make A List of Expenses
With the budget set, you can then calculate all the likely expenses for the holiday. Some of the items that should make to the list of expenses include:
a. Gifts: Make a list of all the people you wish to gift this year. This should include everything from the secret Santa gift for your workmates, small gifts for social events and stocking stuffers, among others. You might also want to budget for extra all-purpose gifts meant to someone you probably forgot to include in the gift’s list.
b. Cards and Postage: Are you looking to send out photos, letters, holiday cards, or calendars via mail? Calculate the cost of printing/buying the cards and the cost of postage for each. Postage should include everything from the cards and shipping costs.
c. Food: Include everything food-related to the list of expenses too. This includes the holiday party you wish to throw at the end of the year, family dinners, and all the treats that come with the same. Be sure to include food and drinks for the family as well.
d. Decorations: This includes all the decorations you wish to buy and use for various parties and celebrations. It can be a Christmas tree, indoor and outdoor decoration lights, Kwanzaa or Hanukkah candles, etc.
e. Clothing: Do you (or a family member) need special clothing or costume for a party or event? Add it to the list of expenses.
f. Travel expenses: Make a list of all expenses you might incur in your travels. Travel expenses can take a big chunk of your savings, hence need to be budgeted for properly. Will you be flying or driving? If driving, you then need to account for gas and toll charges. If flying, then baggage fees, parking fees, and tickets should be included in the list of travel expenses.
Make sure the list of expenses is comprehensive and covers everything you can think of. No expense is too small to overlook. We would also recommend adding miscellaneous expenses to the list as well. You never know what you might want to buy or pay for during the holiday.
3. Set Priorities
There is a good chance your holiday expenses will be more than you anticipated. Although the list may seem endless, setting your priorities right can make it doable, even when working with a limited budget.
First, you’ll need to go through the list of expenses and categorize them according to urgency and need. Mark top priority expenses with a ‘1’ and next priority ‘2’, and so non. Take time to categorize the expenses with the top priority first and on the first page. If gifts are more important than new clothes, you can then eliminate clothing from the list altogether. Allocating more money on the top priority items and less on ‘unnecessary’ items should do it.
4. Shop Smart
If trimming down the gifts list seems impossible, then shopping smart might help. Thanks to the internet, you can now window-shop and compare prices from different sellers, all from the comfort of your chair. Use technology to compare prices from different sellers and even apply for coupons from the same. There are plenty of browser extensions and apps (such as ShopSavvy) that come quite in handy in identifying items sold at discounts and coupon codes as well. Using some of these tools can save you lots of money, as they will identify merchants offering coupons and discounts for their items.
Consider shopping for secondhand items if your friends or family members won’t mind. You will be surprised at the wealth of goods, collectibles, CDs, jewellery, and books eBay and thrift shops have in store, with most in very good condition too.
5. Monitor Your Expenses/Purchases
Make sure to keep track of your expenditures and expenses once the holiday season begins. Remember to stick to the gifts list you created early on and use it to guide you on every shopping trip. You also want to record all costs and expenses that come with any holiday-related outing and undocumented expenses. It is by recording everything that you will be able to plan more accurately in the coming years. Just because you wrote the budget down does mean this is all you will use. You will need to make changes constantly to the budget to suit each year and fine-tune your expenditure. This is the only way you will survive the holidays easily while staying within your limits.
There are plenty of ways, and tools, to keep track of expenditure on different categories. The first and oldest method (works for most of us) is the traditional envelop system. This system is quite simple; you create an envelope for each category, load it with the allocated amount, and are good to go. This means you will only use the money on the specific envelop when paying for something on the envelope’s category list. This allows you to see how much money you have left in each envelope, and when to stop shopping too.
The other method is to set up an isolated bank account for holiday spending. All you need to do is load up the account with the budgeted amount, then use it to pay for every purchase and expenditure within this period. You will only draw money from this account when doing holiday shopping or anything related to holidays. With most banks offering mobile banking, you can track your expenditure from your phone, making it easier to know how much is left in the account. Setting a separate account reduces the risk of spending money meant for other needs or projects.