By Michelle Statz

BDO Debt Solutions

Holiday Spending and Sticking to your Budget

Dec 17, 2021 | 9:18 AM

Some of you may already have completed your holiday spending, but likely many of you have not. Year after year, polls indicate that Canadians continue to spend more and more at Christmas. These statistics are always concerning, since we know that household debt has been rising in the last few years and more and more individuals are struggling with financial challenges.

How does one combat the pressure to spend at this time of year? Part of this is discipline and part is continuing to stick to your budget throughout the holiday season. The budget, or spending plan, is an ongoing part of any household and something that should be reviewed on a regular basis. Incorporating holiday spending into the budget is where it begins.

1. It is important to look at what expenses you have at Christmas. For example, there could be travel, meals, or gifts. Determine what you have available in your budget for spending and then allocate it accordingly across those expenses. Placing a limit on that spending based on your available budget means that you will avoid going into debt for those expenses.

2. When it comes to your gift giving budget, be sure to shop around for your best bargains, do not impulse buy, and try not to leave the shopping to the last minute. You might also look at your list of who you are buying gifts for and see if there is any trimming that can be done. For example, you might consider approaching your friends about foregoing a gift exchange and instead plan to spend some time together. You may be surprised if you approach your friends that they may be relieved as well if they do not have to spend money on a gift for you.

3. Another option is making gifts. Who does not love to receive an assortment of baking or goodies as a gift! Or maybe you re-gift something you may have received previously that you haven’t used.

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4. It is also important not to wait to the last minute to make your expenditures. If you are at the last minute, there is more temptation to impulse buy or end up paying more for that gift. Furthermore, when you are done shopping, do not shop anymore. The tendency is to continue spending even if you have completed your shopping early.

With respect to using credit for your holiday expenses, remember the rule of thumb: if you are charging something to your credit card that you cannot pay off completely in the next 1-2 months, you should not be putting it on your card. If you are already struggling with debt, you want to avoid incurring any further debt just to fund your Christmas holidays.

Remember the holidays are an opportunity to spend time with your loved ones and it is not about the material items. If you find you are struggling or are overwhelmed by your financial situation, we can help you find the right solution. Call 1 855 BDO DEBT to book a free, no obligation consultation with a BDO debt professional.

Michelle is a Licensed Insolvency Trustee, and a Chartered Insolvency and Restructuring Professional. She is a Vice President with BDO and works out of the Regina office. She has been in the industry since 2001 and believes in the system that allows individuals to find solutions to their financial challenges so that they can take charge of their finances once again.

If you are having trouble making ends meet each month, finding the right debt solution can help. Visit the BDO Debt Solutions website for more information about bankruptcy, or call 1 855 BDO DEBT to book a free, no obligation consultation.