Tis’ the season to be jolly – and a little frantic about how to stretch your budget to cover gift purchases for all of your nearest and dearest. Not to mention gratuities and thank you gifts for teachers, garbage collectors, the mail carrier, newspaper deliverers and other professionals – the list seems endless.
Whether celebrating Christmas, Chanukah or Kwanzaa or kicking off the New Year by hosting a Champagne soiree, tis’ definitely the season of spending. This year, try starting a new tradition that will take the strain out of holiday splurging for next year: Start an old-fashioned “Christmas Club” or “Holiday Club.” Get started with our holiday budget tips:
1. Calculate your holiday budget. Keep track of your expenses this season. Include gift buying as well as additional holiday purchases such as baking ingredients, decorations, greeting cards, stamps and charitable donations. When you have a final tally (and a quiet moment after the celebrations come to a close), round off the number to a comfortable figure. Divide it by 12 and you have your monthly savings goal.
2. Research your options. Does your bank or savings and loan association offer a “Christmas Club” or “Holiday Club”, or a savings account with no minimum opening requirement? If not, there very likely are others near you that do. With the surge in online banking options, you may wish to select a reputable institution where you can open a new account online.
3. Consider automatic transfers. When opening a new holiday savings account, you may wish to take advantage of the automatic-transfer feature most banks offer. One holiday budget tip that could help streamline the saving process is linking the holiday account to your checking or regular savings account, and authorizing a monthly transfer in the amount of your monthly holiday savings goal. Once the transfer is set up, you won’t have to worry about remembering to put aside money every month. If your circumstances change during the year, you may be able to adjust the transfer amount up or down, to meet your needs.
When the holidays roll around next year you’ll receive your two rewards: a spending allowance and peace of mind. Perhaps you can even apply these holiday budget tips to other important endeavors, such as saving for birthdays or celebrations.