Tuesday, January 21, 2014

Holiday Hangover

This is an guest post from the Personal Finance Blog Debt Discipline:

There is good news for us early in the New Year, we won’t be suffering from a Holiday hangover. We used cash for all of our purchases this year. We had an incredible Holiday season. My wife and I celebrated our wedding anniversary the week before Christmas with a very nice dinner out. We possibly started a new Christmas Eve tradition by going out to another awesome meal with the family. We spent and average of $350 per person on our shopping list. We hosted a party at our home featuring Bagna Cauda with family and friends. The two dinners out and the party cost us a total of $850.

I can not begin to tell you how much more I enjoyed the Holidays this year, knowing that we went into them with a spending plan and knowing I would not have a lump in my throat when the January bills came in. I truly noticed an emotional difference during these Holidays. There was no stress, no fear when shopping, and really enjoyed the giving more. I am fortunate to receive an end of year bonus from my company which funded 95% of these purchases. This also allows us to spend a little more on our 3 children then we might normally do. This will be the last year we rely so heavily on my bonus to fund Christmas. We are going to be debt free in November and in our 2014 Goals stand up, we except to pull that in by a few months.

This has already got me excited for the Holidays again and got me thinking of being able to participate in some random acts of kindness. I just heard of one at a local Starbucks where a man purchased a $90 gift card and gave it back to the shop to be used for random drive thru customers. These random acts have been popping up across the country. I can’t believe on January 6th I’m already looking forward to Christmas again.


January Blues

January can be a tough month for people who accumulated debt over the holidays. Typically the New Year has you thinking of resolution or goal for the next 12 months. So it’s important to not sit back and feel sorry for yourself, but rather begin to take action. Here are some tips to help get you motivated.  

Access the Damage – You spend it, now own it. Review your bills and get the information down on paper or incorporated into your budget. You’ll need this information to help develop your plan.

Don’t continue – Don’t allow the spending to continue, put the cards away.  

Develop a plan – Once you know how much debt you have and stop spending you need to figure out the plan to attack it. Use any one of these techniques to accomplish the payoff, debt Snowball, lowest balance first or highest interest rate first, etc. Can you squeeze any other areas of your budget to pay extra on this debt?  

Start Saving – Begin to work on you plan for he next holiday season. Maybe try the 52 week savings plan. In the plan you save money each week of the year, equal to the week. So on week 1 you save $1, on week 2 you save $2 and so on and after 52 weeks you will have $1378 saved. So shake off that holiday hangover and get your butt in gear. It’s up to you to take control and make some changes before the next holiday season.

How did you fund your 2013 holiday expenses? Do you have a plan for 2014?

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