November 2015 Financial Matters – Stuart Burns
We are quickly heading into the holidays and New Year and it’s true that the older you get, the faster time seems to pass so you want to be able to enjoy the moments. This can also be a stressful time financially and there are many who are not feeling the joy for different reasons during the holiday season. Let’s look at the most common reasons creating financial stress and what we can do to combat them.
What’s the real reason for our stress?
I am going to jump right in and suggest 2 big reasons for the cause of additional stress during the holidays.
The first is the actual costs of purchases that we may make during the holidays and tendency of many of us to get caught up in the “marketing” aspect of the season. The second thing, and don’t shout me down, is that we bring it on ourselves with our attitude not being on the important things and being caught up in “Affluenza”. So I will start with some tips to make the holidays less stressful from a financial standpoint because many of us will purchase some things, but then we will close by getting real!
Here are some helpful tips to help you plan for the holidays and avoid some the financial stress:
1) First thing to do is to plan out your budget.
a. Figure out how much you can spend. Your budget may have changed year over year so it’s important to review it in context of your current financial state and you can make adjustments up and down accordingly.
b. Be realistic and figure out how much you spent last year. Do the same people apply? Are more added?
i. My wife and I keep an excel sheet of all expenditures down to each item in stockings – it can help to keep an accurate count so that if you want to be somewhat even on the amount spent between people you can track it or just to make sure you are sticking to the budget and it will be handy to use for future estimates.
c. Stick to the amounts
i. If you put specific amounts down – you could try to use something like the envelope system and put a specific amount in each envelope according to your budget. Once the cash is gone – you are done.
2) Start saving ahead of time
a. There are some different ways to do this
i. Open a savings account. You can automatically send over a specific amount each month for holiday spending. Keep in mind this is not your emergency account and you should keep that separate
ii. The earlier in the year you start saving, the less you will need to put in each month or check
3) Consider making purchases online
a. This may actually save you money. California Institute of Technology did a study that showed people will spend 50% more for products in the store where they can directly see them and touch them.
i. Take advantage and make sure you subscribe to some retailers and they will also generally send you online sale notifications.
ii. Some sites such as Dealnews.com will show the day’s best prices on some items.
4) Gift Cards
a. One advantage to giving gift cards is that you can stick to your exact budget amount and not go over.
5) Christmas in July
a. It’s a good idea to think about what you would like to give people for the holidays during the year and you may be able to take advantage of seasonal sales throughout the year.
6) Pay with cash as much as possible
a. The additional stress of carrying more debt on credit cards will give you the January hangover when the bills start coming in. So avoid charging unless you can pay it off comfortably
b. In addition, the costs increase substantially as interest accrues if you don’t pay the balance off quickly
7) Don’t wait till the last minute
a. If you know that Uncle Joe lives across the country and you will be sending him something – don’t wait till the last minute. It may cost you more for last minute purchases and mailings.
b. Don’t wait for the last minute either for local things like “white elephant” gifts and such which can cause you unnecessary stress.
8) Give what’s real!
a. Some of the best gifts you can give might not cost money at all.
i. After we are older and don’t have the specific needs, do you really need another tie, etc? Why not do things like spend time together.
ii. Have fun being together watching a movie and enjoying the day
iii. Plan a small getaway – such as go to Zoolights or drive around looking at the Christmas lights
Let’s get real now!
In Vance Simms book “Man Talk” I wrote a chapter called “Your Money or Your Life”. We discuss a term called “Affluenza” and although it’s not discussed much, it is prevalent through our society today. Affluenza is the mental dysfunction we create by living in a highly marketing oriented society and trying to keep up with the neighbors with a high focus on our material possessions. People are literally stressing themselves out trying to run up the corporate ladder, working excessive hours and time away, and fighting false notions of success, just to keep up. They are turning to alcohol and other addictions as a result. Holiday time is without question the biggest month of the year for retailers and they have savvy marketing to place more desire on things we “want” and make them seem more like a “need”. In the book we discussed that researchers concluded that the cure for affluenza was actually to stop chasing the false sense of worth and to do things like; live within your means, live more moderately, place emphasis on what’s important in life such as time with your family, church and other activities.
So my challenge to you is make this Christmas a time of meaning that has nothing to do with money. Spend time with your family and have fun doing things that don’t cost money – one of the best times I have with my wife is simply driving around looking at lights. We can also get more real by looking at the reason for the season which was a Lord and Savior being born before marketing came into the picture- make it more about Him!
“And there were in the same country shepherds abiding in the field, keeping watch over their flock by night. And, lo, the angel of the Lord came upon them, and the glory of the Lord shone round about them: and they were sore afraid. And the angel said unto them, Fear not: for, behold, I bring you tidings of great joy, which shall be to all people. For unto you is born this day in the city of David a Savior, which is Christ the Lord. And this shall be a sign unto you; Ye shall find the babe wrapped in swaddling clothes, lying in a manger. And suddenly there was with the angel a multitude of the heavenly host praising God, and saying, Glory to God in the highest, and on earth peace and goodwill towards men.” Luke 2:8-14
“Never let all the things you want make you forget about all the
things you have. Put a little gratitude on your to-do list today.”
Wishing you and your families a Happy Thanksgiving and Blessed Christmas!
Don’t forget to listen to Vance on “The Father Matters Show” on Faith Talk 1360AM.
For some great financial tools and resources go to: http://learn.bankofamerica.com/money-management/ and http://www.bettermoneyhabits.com or contact Stuart Burns at 602-464-1381 or email me at stuart.j.burns@bankofamerica.com