Festive Holidays: How They Affect Your Finances & How to Stay in Control

Festive holidays are happy moments, and we tend to add to the joy of the season by spending a little extra. Here’s how to spend your money wisely:

It is essential that we stay in control of our finances in order to achieve financial stability, or to ensure its continued growth. But sometimes we lose track of this goal, especially during special events such as festive holidays. Splurging to add to the cheer of the season is always fun and while it’s fine to do so, it’s also important to make sure we stay on track with our finances. Here’s why: 

How then can you go about ensuring your financial security, even during festive seasons where your expenses could add up manifold? Here are six best practices to keep in mind to help you prioritise your finances during the festive season:

Come Hari Raya, Chinese New Year or Deepavali, happy moments tend to be a time when people upgrade certain areas of their lives, whether it’s a brand-new MPV to fit their growing family, or repainting the house. This is especially true as some civil servant bonuses are usually timed with these celebrations, leading to a boost in disposable income. It is important to reassess your priorities and consider if these purchases are based on your actual needs or your wants.  

The costs for these upgrades are typically very high and could result in you having to fork out extra after the purchase period – such as higher maintenance fees for a new car. At the end of the day, it could very well be unnecessary expenditure that could have been better used to eliminate a small debt or to build your savings.

Give your expenditure a boost by setting up a separate account specifically for festive season spending. This is so that you won’t risk eating into your main savings. Simply split the regular amount of savings you set aside each month into two different categories: one for personal savings and one for festive spending. While this might mean cutting down on the amount typically put aside in monthly savings, once the festive shopping begins, you will find it prevents you from dipping into your savings pool. This is because you will only be spending from the allocated amount for the festive season. Alternatively, choose to set aside additional monies for the festive season spending account. Pro tip: the earlier you begin, the more you get to spend.

Traveling to one’s hometown to be reunited with the extended family for celebrations can be costly, and is especially true for families with children. As the festive season often coincides with a long holiday, it is also peak time for holidaymakers, which often causes travel fares to increase. Early planning helps here. Finalise your travel plans ahead of time for better savings, or carpool if you know someone headed the same way. There are plenty of sites that offer cheaper travel packages or that can help you make price comparisons – be sure to utilise every available resource.

More often than not, preparing your own food or tidbits costs less than what you would spend when buying ready-made treats. Using the rising cost of ingredients as an excuse, sellers often hike up prices of festive treats. If you are able to make your own food, you could avoid overspending by purchasing the ingredients at cheaper prices before the festive season hits. And as you get busy preparing your festive snacks and dishes, you can also rope in your loved ones to help out and turn it into a family bonding session.

Before you begin stocking up on goodies and decorations, check if friends or family are interested in making joint purchases. Buying in bulk could result in savings on your final cost. Planning this way helps you to be kinder to your finances, and you may even have leftovers from your budget at the end of the spending period.

This advice is bandied around pretty often but there’s truth in it, which is why it’s so popular. There are various sale periods that happen throughout the year. Take advantage of these sales to stock up in advance, especially on non-perishables. Avoid the festive sales crowd and look out for clearance sales or price drops on things such as decorations or materials for making clothes so that you are able to purchase them quickly and tick them off your “To Buy” list long before the festive season rolls around.

References

http://www.thestar.com.my/metro/community/2017/04/22/drop-in-orders-for-cookies...

http://www.theborneopost.com/2017/01/10/costlier-cny-celebration-this-year-due...

https://www.timeout.com/kuala-lumpur/food-and-drink/best-caterers-in-kl

https://www.imoney.my/articles/your-raya-grocery-expenses-have-increased...

https://www.comparehero.my/blog/5-ways-save-travel-hari-raya

https://www.akpk.org.my/content/402-money-saving-tips-raya

https://www.gobear.com/my/blog/detail/Top-6-Money-Saving-Tips-This-CNY

The above articles are intended for informational purposes only. AIA accepts no responsibility for loss which may arise from reliance on information contained in the articles.