The True Cost of the Holidays
January 2, 2006
The True Cost of the Holidays Written by Thomas Martucci
The holidays are now behind us, all the presents have been
exchanged and opened and the decorations put away for next year.
Like a ton of bricks, it hits us! We begin to receive our credit
card and bank statements and when we open them we all feel "this
can't possibly be right!" but after careful review we come to
find it is. After the initial shock of how much we actually
spent during the holiday season, we begin to rationalize our
spending "we only do this once a year," "after all, the kids had
a great time," and the rationalization can go on and on.
We will now pay off our debt for months and maybe even the
entire year. Let this year be the last year this debt falls upon
you.
Before you allow time to pass, start doing the following three
things:
1. Calculate how much you really spent on the holidays this past
year. 2. Calculate how much you really need to spend next year
and start budgeting for it. You can do this by using our Holiday
Spending Worksheet and Budget located at
www.budgetkeepersystem.com. 3. Determine and start implementing
how you are going to save the money for next years holiday
shopping.
Our Holiday Spending Worksheet is broken down into three major
areas as follows:
Gifts: For immediate family, friends, relatives, office
personnel, etc. capture your spending from this past season by
calculating your receipts and credit card and bank statements.
Food/Entertaining: These categories are the forgotten
categories. Try to calculate how much money you spent on holiday
entertaining, this will include things like food, alcohol, soft
drinks, baking items and that new sweater.
Decorations: Don't forget about the cost of decorating your
house/apartment for the holidays. The lights, trees and
ornaments all add up!
Now that you have calculated all your expenses, I believe you
will agree that the actual amount you spent was a lot more than
you anticipated. As they say "don't cry over spilled milk."
Let's just make sure we are more prepared and careful with our
spending for next year.
The basic philosophy of the BUDGETkeeper SYSTEM is that you
should sit down with your significant other (if applicable) to
review and discuss your holiday spending and the true cost. Now
is the time to ask some questions and start budgeting for next
year.
1) Relative Gifts: Is gift giving to aunts, uncles and cousins
really necessary? This gift giving does add up to a lot of
money. I'm sure they are all faced with the same situation as
you. Maybe you should all discuss and agree to exchange one
family gift or even better yet, no gift exchanging at all. 2)
Immediate Family Gifts: Were three pairs of pants and ten toys
for each child really necessary? Think this through and
determine how much you are going to spend next year on each
member of your immediate family. 3) Friends: Maybe exchanging
some sort of homemade item like cookies would be a good idea
instead of buying a present next year. 4) Decorations: Are you
surprised at the amount spent on decorations? Maybe next year
you can just use the decorations you have without purchasing
additional ones. 5) Food: Every holiday season we go overboard
on food. Stop to think how much food was thrown away after the
holiday season. Maybe next year you could cut back on the
quantity of food purchased. Make a single batch of cookies
instead of a double batch. 6) Entertainment/Holiday Cards: How
many unnecessary holiday cards did you mail? Is it necessary to
send a holiday card to every person on your block? Did you
really need to purchase a new sweater for your holiday party?
Next year mail holiday cards only to relatives or friends you
have not seen or talked to in long while and wear that same
holiday sweater to your party, nobody will remember.
Now that you have reviewed and planned for your next years
holiday budget, attach to your Holiday Spending Worksheet and
Budget notes on how you are going to change your spending habits
for the next year. Put this information in your October file so
you have it readily available next year when it comes time for
holiday shopping.
You now have to determine how you are going to start saving for
next year. Why not join a Holiday Club or open a new savings
account just for the holidays and always remember that "Cash is
King" and credit cards are not an option for next year's holiday
season.