There are no two ways about it – Christmas can be an expensive time of year. Many people often overspend at Christmas time, splashing out on presents, food, nights out and more, with the thought that they will delay the problem until January and sort it out then. Indeed, according to short term loan website Growing Power – searches for short term and emergency funding peak in January and February, as people struggle to meet their critical bills having dipped into their emergency funds.
As I write this, January is a mere two days away, and so the time to reclaim control of your money is here. Below we list 5 things you can do to restore order in your financial World if you have overspent this yuletide.
Assess the problem
This is to time to bury your head in the sand – you need to be open and honest with yourself about the amount you have spent and what the damage is. Download your bank statements and credit card bills and work out how much you have spent and how much debt you have accumulated. Use this to generate a figure that you need to hit to get yourself back on track financially.
Return anything you don’t want or need
If you are anything like me, then chances are you will have bought presents that you didn’t end up giving. And despite the sender’s good intentions, you will also have received some presents that you aren’t particularly keen on. If you have receipts for any of these items, then you should look to return them as soon as possible and see if you can get a refund.
Anything that you can’t return, you could look to sell on eBay or Facebook marketplace (or any other local buy/sell forum).
Commit to a spending hiatus
January is a great time for new beginnings. Commit to yourself that you will curb your spending this month. For 31 days, promise yourself that you will stay out of any shops that you know are a spending weakness for you, try and avoid eating and drinking out (even though there are often lots of 2 for 1 deals in many restaurants in Jan), make your own packed lunches for work, take your own coffee in the morning and save those few pounds you would normally spend at Starbucks. Any way you can cut your spending this month – do it!
While we are on the topic of new beginnings and fresh starts, you should also evaluate your outgoings and be honest about the value you get from some of your subscriptions. Could you cancel some of these and pocket the savings? Many subscriptions such as Netflix, allow you to use the subscription on multiple devices – could you buddy up with a friend to share the cost of a subscription and therefore halve the cost for both of you?
Review your budgeting
If you have a budget planner, now is a good time to update it. Work out exactly how much you need to reduce your outgoings by in order to recoup the debt accrued over Christmas time as quickly as is realistically possible.
If you don’t have a budget, then you really should have one. Use a spreadsheet (if you don’t have Microsoft Excel, then Google Sheets is a free alternative) or even just old fashioned pen and paper, and write down all of your expenses and incomings to see if you are on track to have some money to set aside each month, or if you are on a perpetual path to adding to your debt every month. Only by knowing the truth about our problems, can we take action to solve them.
Earn some extra money
If, even after all these cost-cutting measures, you are still on course to add to your debt each month, then you need to look at a way you can add extra income.
Is requesting a raise a realistic prospect? If not, could you move jobs and earn a little more with a different employer? Are there any side-hustles or part-time jobs you could take on? Selling items on eBay, babysitting, walking dogs, delivering packages or pizzas, waiting tables – any of these could be a good short-term solution to putting a few more pounds in your pocket and get you on track to getting back in the black. You don’t need to work tons of hours at these either. Just ten hours per week at minimum wage would provide an additional ~£350 per month (before tax and national insurance).
Following these tips could help you recoup that Xmas debt and put you on track for a prosperous and successful 2020. Happy New Year!